Macroeconomics
13th Edition
ISBN: 9780134744452
Author: PARKIN, Michael
Publisher: Pearson,
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Chapter 4, Problem 20APA
To determine
Explain the changes in the real
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Students have asked these similar questions
1. According to the BEA, in the second quarter of 2012 personal consumption expenditures grew by 1.7 percent, gross private domestic investment grew by 3.0 percent, government expenditure on goods and services decreased by -0.9 percent, imports grew by 2.9%, and exports grew by 6.0%. Given these data, it is most likely that
A) GDP growth was positive in the 2nd quarter.
B) GDP growth was negative in the 2nd quarter.
C) the economy hit a business cycle peak.
D) the economy hit a business cycle trough.
2. In the national income accounts, government expenditure on goods and services exclude
A) transfer payments.
B) state and local government purchases.
C) local government purchases but include state government purchases.
D) spending on national defense.
3. Transfer payments
A) are included in the government expenditure category in gross domestic product.
B) refer to all payments made to households by governments.
C) refer to payments made by the government that are not made to…
Suppose that a farmer grows wheat, which she sells to a miller for $10. The miller turns the wheat into flour, which she sells to a baker for $55. The baker turns the wheat into bread, which she sells to consumers for $140. Consumers eat the bread. What is GDP in this economy?
Consider the following table showing the breakdown of GDP (in billions) for China.
GDP Category
Amount (in billions)
Consumption
1700
Investment
700
Government Expenditure
100
Exports
50
Imports
40
Using the expenditure approach, calculate GDP for China.
Briefly discuss five reasons why a rise in real Gross Domestic Product within a country over time does not necessarily mean that living standards have improved.
Chapter 4 Solutions
Macroeconomics
Ch. 4.1 - Prob. 1RQCh. 4.1 - Prob. 2RQCh. 4.1 - Prob. 3RQCh. 4.2 - Prob. 1RQCh. 4.2 - Prob. 2RQCh. 4.2 - Prob. 3RQCh. 4.2 - Prob. 4RQCh. 4.2 - Prob. 5RQCh. 4.3 - Prob. 1RQCh. 4.3 - Prob. 2RQ
Ch. 4.3 - Prob. 3RQCh. 4.3 - Prob. 4RQCh. 4.3 - Prob. 5RQCh. 4 - Prob. 1SPACh. 4 - Prob. 2SPACh. 4 - Prob. 3SPACh. 4 - Prob. 4SPACh. 4 - Prob. 5SPACh. 4 - Prob. 6SPACh. 4 - Prob. 7SPACh. 4 - Prob. 8SPACh. 4 - Prob. 9APACh. 4 - Prob. 10APACh. 4 - Prob. 11APACh. 4 - Prob. 12APACh. 4 - Prob. 13APACh. 4 - Prob. 14APACh. 4 - Prob. 15APACh. 4 - Prob. 16APACh. 4 - Prob. 17APACh. 4 - Prob. 18APACh. 4 - Prob. 19APACh. 4 - Prob. 20APACh. 4 - Prob. 21APACh. 4 - Prob. 22APACh. 4 - Prob. 23APACh. 4 - Prob. 24APACh. 4 - Prob. 25APACh. 4 - Prob. 26APACh. 4 - Prob. 27APACh. 4 - Prob. 28APA
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- Last year, a small nation with abundant forests cut down 200 worth of trees. It then turned 100 worth of trees into 150 worth of lumber. It used 100 worth of that lumber to produce $250 worth of bookshelves. Assuming the country produces no other outputs, and there are no other inputs used in producing trees, lumber, and bookshelves, what is this nations GDP? In other words, what is the value of the final goods the nation produced including trees, lumber and bookshelves?arrow_forwardWhy do you think that GDP does not grow at a steady rate, but rather speeds up and slows down?arrow_forwardRefer to the table below for a very simple economy producing three goods: movies, pizzas and cars. Steel panels are needed for car production, cheese is necessary for making pizzas and CGI service is used for movie production. What is the nominal GDP for the economy in 2021? What was the nominal GDP in 2016? What is the real GDP in 2021 using 2016 prices as base year prices? What is the real GDP growth rate between 2016 and 2021?arrow_forward
- 4. Measuring GDP The following table shows data on consumption, investments, exports, imports, and government expenditures for the United States in 2014, as published by the Bureau of Economic Analysis. All figures are in billions of dollars. Fill in the missing cells in the table to calculate GDP using the expenditure approach. Data (Billions of dollars) Consumption (C) 11,930.3 Investment (I) 2,851.6 Exports (X) 2,337.0 Imports (M) 2,875.2 Net Exports of Goods and Services Government Purchases (G) 3,175.2 Gross Domestic Product (GDP)arrow_forwardThe BEA says “Real gross domestic product (GDP) increased at an annual rate of 2.9 percent in the fourth quarter of 2022”. Your friend has gone to FRED and pulled up the numbers FRED gives for the “Percent Change” and the “Percent Change from Year Ago” in real GDP for the 4th quarter of 2022. It turns out (you can verify this) that neither of those numbers is consistent with what the BEA says real GDP increased by. So your friend is very puzzled. Write one paragraph in your essay that helps your reader clearly understand what this 2.9 percent number really means, using the FRED numbers for context.arrow_forward1.3 Read the following extract and answer questions 1.3-1.5.South Africa’s economy grew by 1.1% in the first quarter of the year. Stats SA has published the latest gross domestic product (GDP) data covering the first quarter of the year, showing that the economy grew by 1.1% in the first three months of 2021. The growth follows a revised 1.4% rise in real GDP in the fourth quarter of 2020. On an annualised basis, the economy grew 4.6% quarter-on-quarter. Following confusion caused by the annualisation of GDP data in 2020 – amid the Covid-19 pandemic and resulting lockdowns – Stats SA said it would no longer use the annualised data as the headline GDP statistic. During periods of steady economic growth, annualising is a useful way of expressing quarter-on-quarter performance in annual terms, Stats SA said. However, during periods of economic instability, annualising can be misleading, because it exaggerates growth rates that are unlikely to be repeated. The central problem that is…arrow_forward
- 1.3 Read the following extract and answer questions 1.3-1.5.South Africa’s economy grew by 1.1% in the first quarter of the year Stats SA has published the latest gross domestic product (GDP) data covering the first quarter of the year, showing that the economy grew by 1.1% in the first three months of 2021.The growth follows a revised 1.4% rise in real GDP in the fourth quarter of 2020. On an annualised basis, the economy grew 4.6% quarter-on-quarter.Following confusion caused by the annualisation of GDP data in 2020 – amid the Covid-19 pandemic and resulting lockdowns – Stats SA said it would no longer use the annualised data as the headline GDP statistic.During periods of steady economic growth, annualising is a useful way of expressing quarter-on-quarter performance in annual terms, Stats SA said. However, during periods of economic instability, annualising can be misleading, because it exaggerates growth rates that are unlikely to be repeated.Source:…arrow_forwardAnalyzing a Table: Analyzing a Table: item billions of dollar consumption ependiture 6258 investment 1623 government expenditure on goods and services 1630 exports of goods and services 998 imports of goods and services 1252 The table above gives the values of different expenditures in the United States during 1999. Answer the following questions about the United States. What was the value of net exports of goods and services in 1999? What was GDP equal to in 1999?arrow_forwardThe country of Batavia produces only chocolates and watches. Below is a table with recent information on Batavia production and prices. The base year is 2009. Prices and Quantities Year Price of A Box of Chocolates Boxes of Chocolates Price of Watches Quantity ofWatches 2008 $4 100 $50 10 2009 $5 90 $50 15 2010 $5 100 $60 15 2011 $6 80 $65 12 What was nominal GDP, real GDP, and the GDP deflator for 2008? What was nominal GDP, real GDP, and the GDP deflator for 2009? Show your work. What was nominal GDP, real GDP, and the GDP deflator for 2010? Show your work. What was nominal GDP, real GDP, and the GDP deflator for 2011? Show your work. What was the inflation rate for 2010? Show your work. What was the inflation rate for 2011? Show your work.arrow_forward
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