Consider an economy with two firms. Firm A produces cotton and firm B produces cotton swabs. In a given year, firm A produces 100,000 pounds of cotton, sells 40,000 pounds of cotton
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- Consider an economy that produces wood, boats, and has a marketing agency.This year domestic wood production generates revenues of $80. Of this $80 worth of wood, $40were purchased by the boat producer and $40 were sold abroad to a foreign company. The woodproducer paid $40 worth of wages and $10 worth of taxes.The boat producer combines the services of the marketing agency, the wood it purchased from thewood producer, and $20 worth of labor (wages) to produce $120 worth of boats. Its revenues,which include a boat produced in the previous year and that was carried as inventory, are $130.Domestic families buy all these boats. This company pays $10 worth of taxes.The marketing agency, whose sole client is the boat company, generates a revenue of $40 whichis enough to cover its labor costs of $40. This company pays no taxes.The government in this economy uses the $20 worth of taxes and builds a port. The cost of theport is $40 that are paid to workers. This port is partially financed by…The country of Sylvania produces and consumes only three goods: Red Bull, pizza, and T-shirts. The quantity produced and price of each good in 2011 and 2012 are given in the following table: 2011 2012 Quantity Price Quanity Price T-Shirts 90 $25 108 $25 Red Bull (cans) 510 $2 510 $3 Pizza (slices) 980 $3 900 $6 Nominal GDP in 2011 was $... and nominal GDP in 2012 was $..... (Enter your responses as integers.) If 2011 is the base year, real GDP in 2011 was $.... and real GDP in 2012 was $...... (Enter your responses as integers.) Based on your answer above, the percentage change in real GDP between 2011 and 2012 was...... percent. (Round your response to two decimal places and use a minus sign if necessary.) If 2012 is the base year, real GDP in 2011 was $..... and real GDP in 2012 was $..... (Enter your responses as integers.) Based on your…The nation of Potchatoonie produces hockey pucks, cases of root beer, and sandals. The following table provides data on prices and quantities of the three goods in years 2017 and 2020. Instructions: Enter your responses as whole numbers. Year Pucks Root beer Sandals Quantity Price Quantity Price Quantity Price 2017 100 $7 300 $20 100 $20 2020 125 $7 250 $20 110 $25 Assume that 2017 is the base year. Find nominal GDP and real GDP for both years. Year Nominal GDP Real GDP 2017 $ $ 2020 $ $
- The equations below describe the aggregate demand of an economy. There are neither a flow of goods and services nor capital across borders of this country. Y=C +I +G………. (1) C=Co+C(Y^d)……. (2) Y^d= Y-T…………. (3) T=t(Y) ……………. (4) I=Io+I(r)………… (5) G=Go……………... (6) M=PL(r,Y)……… (7) where Y is gross real domestic product, C is aggregate consumption expenditure by households, I is aggregate investment expenditure by firms, is government purchases of goods and services, Y^d is disposable personal income, and T is total income tax payments to government by…The equations below describe the aggregate demand of an economy. There are neither a flow of goods and services nor capital across borders of this country. Y=C +I +G………. (1) C=Co+C(Y^d)……. (2) Y^d= Y-T…………. (3) T=t(Y) ……………. (4) I=Io+I(r)………… (5) G=Go……………... (6) M=PL(r,Y)……… (7) where Y is gross real domestic product, C is aggregate consumption expenditure by households, I is aggregate investment expenditure by firms, is government purchases of goods and services, Y^d is disposable personal income, and T is total income tax payments to government by…Assume an economy with two firms. Firm A produces wheat and firm B produces bread. In a given year, firm A produces 50,000 bushels of wheat, sells 20,000 bushels to firm B at $3 per bushel, exports 25,000 bushels at $3 per bushel, and stores 5,000 bushels as inventory. Firm A pays $50,000 in wages to consumers. Firm B produces 50,000 loaves of bread, and sells all of it to domestic consumers at $2 per loaf. Firm B pays consumers $20,000 in wages. In addition to the 50,000 loaves of bread consumers buy from firm B, consumers import and consume 15,000 loaves of bread, and they pay $1 per loaf for this imported bread. Calculate gross domestic product for the year using the product approach.
- 1. Calculate GDP, NDP, NI, PI, and DI from the following information. All numbers are in billions of dollars. Wages $ 26,500Consumption Expenditures $30,000Government Expenditures $15,000Imports $18,000Exports $20,000Property Taxes $16,000Sales Taxes $9,715Retained earnings $1,310Personal Income Taxes $2,200Private Investment Expenditures $14,000Interest Income $1,940Pay Roll taxes $1,000Transfer Payments $800 Depreciation $1,200Net Income Made Abroad by Americans $160Indirect Business taxes $2,000Corporate Income Taxes $300 2. Calculate a) labor force, b) labor force participation rate, and c) unemployment rate if the population of a country is 240 million people out which 70 million are under the age of 16, 30 million don't want to work and 10 million are looking for work. 3. Calculate the inflation rate from 2019-2020 if the index number in 2019 was 115 and the index number in 2020 was 119.The nation of Potchatoonie produces hockey pucks, cases of root beer, and sandals. The following table provides data on prices and quantities of the three goods in years 2011 and 2014.Instructions: Enter your responses as whole numbers. Pucks pucks root beer root beer sandals sandals Year Quantity Price Quantity Price Quantity Price 2011 100 $5 300 $15 100 $20 2014 125 $7 250 $20 110 $25 Assume that 2011 is the base year. Find nominal GDP and real GDP for both years. Year Nominal GDP Real GDP 2011 $ $ 2014 $ $Suppose an economy produces steel, wheat, and oil. The steel industry produces $80,000 in revenue, spends $4,000 on oil, $8,000 on wheat, pays workers $60,000. The wheat industry produces $120,000 in revenue, spends $20,000 on oil, $10,000 on steel, and pays workers $80,000. The oil industry produces $180,000 in revenue, spends $20,000 on wheat, $20,000 on steel, and pays workers $80,000. There is no government. There are neither exports nor imports, and none of the industries accumulate or deaccumulate inventories. Calculate GDP using the production and income approaches.
- Consider an economy that produces two goods, an agricultural good and a manufacturing good. An amount YA of the agricultural good can be produced using the following equation: YA = LA where LA is the amount of labor used in this sector. An amount of YM of the manufacturing good can be produced using the following equation: YM = KθLM 1-θ where K is capital stock and LM is the amount of labor used in such sector. So, this economy’s total output (i.e. GDP) is: Y = YA + YM. This economy has zero population growth rate (i.e. n = 0) and the depreciation rate is δ. The total number of workers in the economy is L and of course, L = LM + LA. Let P = LA/L. Furthermore, define: y = Y/L, k = K/L and c = C/L. As usual, we have: ∆k = sy – (δ+n)k. Please use the above information to derive the key equation for this version of Solow model. Show the steady state of the economy is a diagram with k as the x-axes. Label k* , y* and c* in your diagram.Assume that in Berberistan only three goods are produced: coffee, tea, and cheesecake. The table below shows the prices and quantities of the three goods in 2018, 2019 and 2020. (Take 2018 as the base year when necessary) 2018 2019 2020Quantity price quantity Price quantity PriceCoffee 2 20 6 10 5 12Tea 20 2 20 2 25 3Cheesecake 15 8 10 10 15 5a) What is the nominal GDP in 2019. b) What is the nominal GDP in 2020. c) What is the real GDP in 2019.d) What is the real GDP in 2020.e) What is the real economic growth from 2019 to 2020.Assume an economy with two firms. Firm A produces wheat and firm B produces bread. In a given year, firm A produces 4000 tonnes of wheat, sells 1000 tonnes of wheat to firm B at $20 per tonne, exports 2500 tonnes of wheat at $20 per tonne, and stores 500 tonnes as inventory. Firm A pays $50,000 in wages to consumers. Firm B produces 50,000 loaves of bread and sells all of it to domestic consumers at $3 per loaf. Firm B pays consumers $10,000 in wages. In addition to the 50,000 loaves of bread consumers buy from firm B, consumers import and consume 20,000 loaves of bread, and they pay $2 per loaf for this imported bread. Calculate gross domestic product using a. the product approach b. the expenditure approach c. the income approach
