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1. Why are only final goods counted in measuring GDP for a particular year? Why is the value of used furniture that's bought and sold not counted?
2. What are the three main types of consumption expenditures? Why are purchases of new houses considered to be investment expenditures rather than consumption expenditures?
3. Why are changes in investors included as part of investment spending? Suppose inventories declined by $1 billion during 2012. How would this affect the size of gross private domestic investment and gross domestic product in 2012?
Consumption is $6 trillion, investiment is $2 trilion and government purchases are 2.5 trillion. The country exports $1 trillion and imports 1.5 trillion. Find the net exports and solve for the level of aggregate demand.
Briefly explain what the incentive was to create and attend the first Earth Day. What economic principles might explain your answer to Question 1?
when p is above the level that generates maximum output, will cause unemployment - when p is at a level that generates maximum output, LS meets LD - find another person with a coconut and trade with that person and gain u¯. the difference in the pri..
A question has arisen as to whether expensive treatment options such as surgery should be made available, despite the ability for patients to pay.
A food chain charges higher prices for its products in poorer neighborhoods compared to the ones in affluent communities. Give your opinion on why this occurs. Provide support for your response.
Holding other factors constant, will the quantity of investment spending increase more in the closed economy or in the small open economy Explain. Assume prices are flexible and that factors of production are fully employed in both economies.
If you could choose to work as many hours during the week as you wanted at a given per hour wage rate, to what level would the per hour wage rate have to be before you would begin to choose fewer hours to work
The marginal cost of this firm is equal to its average total cost and is constant at $4 per unit produced. Set up diagrams that shows the demand and the marginal revenue curves of this firm, as well as the quantities and prices it charges in each ..
Economics and finance have two different meanings when it comes to total cost. To an economist it means?
Assume that capital and labor both exhibit diminishing marginal returns, so that capital can be substituted for labor in the production process (and vice versa), but capital and labor are not perfect substitutes. How would such a tax affect the rel..
Analyse the economic situation in Greece since the financial crisis, the effects the austerity measures have had and may have on the economy, and provide a recommendation to future policy makers.
If Ron is lazy, he will surf the Internet all day, and he views this as a zero cost opportunity. However, Ron would view working hard as a "personal cost" valued at $1000. What fixed percentage of the profits should you offer Ron? Assume Ron ca..
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