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Home work ch 11

29/09/2020 Client: user_3wd25t Deadline: 2 Day

1. Would it be possible for an increase in taxation to decrease the gross domestic product measured in the U.S.? Why or why not?


                             2.   Adam's Ribs in downtown Chicago buys $10,000 worth of beef ribs, $25,000 worth of pork ribs, and $8,000 worth of napkins each month. Are these purchases included in the calculation of gross domestic product? Explain your answer.


                              3.         Using the expenditure approach, calculate GDP using the following data.


Item


Amount in dollars (billions)


Total Consumption


9,600


Consumption of Durable Goods


1,600


Consumption of Non Durable Goods


2,800


Consumption of Services


3,200


Total Investment


3,750


Fixed Investment


1,000


Government purchases of Goods & Services


2,675


Government Transfer Payments


450


Exports


800


Imports


900


GDP Equals=


                     4.   (a) What is the importance of measuring per capita GDP?


                         (b) How do pollution and crime affect GDP?


                    5.       What is the underground economy? How does it affect GDP calculations? Provide three examples of  underground economy transactions.

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