Question 1: The table above gives some of the items in the U.S. National Income and Product Accounts in 2010.
|
ITEM
|
$
|
|
Wages
|
3,900
|
|
Consumption Expenditure
|
4,000
|
|
Taxes
|
400
|
|
Interest, rent, and profit
|
1,400
|
|
Investments
|
1,100
|
|
Government Expenditure
|
1,000
|
|
Depreciation
|
1,329
|
|
Net export
|
300
|
1. Calculate U.S. GDP in 2010? Precise which approach did you use.
2. Calculate the net domestic product?
3. I sell my car, a 2005 Chevrolet, for $5,000 in May of 2015. Does this transaction affect the GDP of 2015? Justify your answer.
Question 2: Use the following information to answer this set of questions.
|
Item
|
Price in 2012
|
Quantity in 2012
|
Price in 2013
|
Quantity in 2013
|
Price in 2014
|
Quantity in 2014
|
|
Bikes
|
$100
|
10
|
$150
|
10
|
$150
|
20
|
|
Pencils
|
$1
|
100
|
$1
|
100
|
$2
|
50
|
|
Telephones
|
$100
|
20
|
$80
|
50
|
$60
|
80
|
a. Calculate nominal GDP for 2012, 2013, and 2014. Show the formula and the details of your calculation.
b. Calculate real GDP for 2012, 2013, and 2014 using 2012 as the base year? Show the formula and the details of your calculation.