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- Suppose the U.S. Congress passes significant immigration reform that makes it more difficult for foreigners to come to the United States to work. Use the AD/AS model to explain how this would affect the equilibrium level of GDP and the puce level.Give typing answer with explanation and conclusion to all parts In the United States, real GDP is currently calculated using A) a variable-weighting scheme. B) a chain-weighting scheme. C) a fixed-weighting scheme. D) an autoregressive scheme.Which components of Aggregate Expenditure change as a result of a change in real GDP? Question 3Answer a. consumption, investment, and exports b. consumption and investment c. consumption, investment, and government expenditures d. consumption and governments e. consumption and imports
- Suppose an economy has two years worth of data, years 1 and 2. Sup- pose there are also two goods, bread and corn. Suppose in year one fifty units of corn are sold at a price of 1 $ and 20 units of bread are sold at a price of 2 $. Suppose in year two, 60 units of corn are sold at a price of 1.5 $ and 80 units of bread are sold at a price of 2.05 $. Compute nominal GDP in both periods. Compute real GDP under both definitions of a base year. Compute also a chain weighted real GDP series. For all three measures, compute the GDP deflator. In addition, compute a CPI’s for each base year assuming total consump- tion in the base year forms the basket of goods for measurement. What are the implications for these measures for the amount of inflation in this economy. [Note, you should have five candidate measures]. What about the amount of economic growth? Suppose that corn in year 2 is twice as valuable as corn in year 1 to consumers in terms of their enjoyment from its consumption (or in…Let’s figure out GDP for Robinson Crusoe (RC) stuck on a desert island Initially RC is stuck on an island without much wisdom and local knowledge. Because RC is a proper Englishman, he wants to keep records of things. In year A he catches and eats 2,000 fish valued at one dollar each, grows and eats 4,000 coconuts valued at 0.50 cents each, and makes 2 huts (housing) valued at $200 each. Now, using the following: A) If government purchases are zero and there is no trade, what is C for Crusoe? What is I? What is Y? (We are going to start using those letters as if they mean something). B) Next year, RC learns of a tribe on a nearby island who are willing to trade with him: If he gives fish, they give clams. He produces just as much fish as before (in part A) , but he trades 500 of the 2,000 fish and receives 10,000 clams valued at 5 clams per dollar. What are the NEW dollar values of: the exported fish? the imported clams? What are C, and I? What is GDP (Y) now? C) The following year,…Suppose you are given the following information: Qs = 100 + 3P Qd = 400 – 2P where Qsis the quantity supplied, Qdis the quantity demanded and P is price. 1. Years ago, Ricky paid $500 for CDs to put together a collection. Today, he sold hisCDs for $200. How does this sale affect current GDP?
- Consider how each of the following events is likely to affect real GDP. Do you think the change in real GDP reflects a similar change in economic well-being? d. Businesses and firms throughout the economy experience falling demand, causing them to lay off workers e. Government passes new environmental laws that prohibit firms from using production methods that emit large quantities of pollution.Need asap please... If the U.S. government wanted to, it could just say that everyone who is unemployed is “employed in the job search” and receiving a paycheck for this “work,” and the government could claim that these government employees are producing “job search services.” Recall that in the official definition of GDP, government purchases(G), do not include transfer payments like unemployment checks and Social Security. -- Would this change in the definition of GDP increase GDP? Would it improve well-being?If a Japanese tourist drinks German beer in a hotel in New York City, how will the U.S. GDP be affected? Give your answer using both the expenditure approach and the output approach.
- Given the following: Ca = $100, Ig = $50, Xn = − $10, and G = $30, what is the economy’s equilibrium GDP?Use two diagrams to explain the effects of the determinants of aggregatedemand on real GDP in a nation. ii. Suppose there is an expectation of a rapid general price increase in goodsand services in Australia in January 2021. Examine the effects of theanticipated general rapid increase in price for goods and services.Why must double counting be avoided when measuring GDP? Provide an elaborate answer with at least one example. Part B: Aggregate Demand (AD) Curve shows the relationship between the economy’s price level and real GDP demanded. In other words, real GDP demanded by different groups of buyers, i.e., Consumers (C), Businesses (I), Government (G), and Net Amount by Foreigners (Export - Import), at different price levels give us points on a graph, which are connected to form a curve called AD curve. Review the textbook chapter, and conduct internet research to discuss determinants of AD or factors that shift AD curve. Part C: Following graph shows business cycle fluctuation in a hypothetical economy. "Y" denotes year, and "Q" denotes quarter. What do points A, B, C, and D denote? Write at least a sentence each about what these points denote. Also, explain what represent the curve segments: A to B, B to C, and C to D. Lastly, because economic activity fluctuates, how is long-term…