1. What is Gross Domestic Product? Why used good is not a part of GDP?

2. Explain whether or not, why, and how the following items are included in the calculation

of GDP?

a) Suppose that the appliance store buys a refrigerator from the manufacturer on December 15, 2016

for Tk. 25,000, and that you then buy on August 5, 2017 for Tk. 40,000. What is the contribution to

GDP in fiscal year FY 2017 (July 2016 to June 2017)?

b) Suppose, an investor from Bangladesh made an investment in Japan during the fiscal year FY2017,

will it be counted in Bangladesh's FY2017 GDP measurement?

c) Suppose, both your mother and the servant equally contribute to manage your 5 - years old child

while you and your wife are at office? The servant is hired by following institutional procedure.

Whose contribution will not be a part of the GDP and why?

d) Sand mining is illegal in Brahmaputra river Basin. But, the local (powerful people) elites with the

of dredgers extract sand from the river beds. Per ton sand extraction costs roughly 0.75 taka for those

political elites. Then, the group of elites sell per ton sand to bulkhead (carrier vessels) owners at 1.5

taka. The bulk-head owners then sell per ton sand at 2.5 taka. The wholesaler bears all the uploading

and loading charge. Let's assume, the wholesaler sells 50,000-ton sand per year at 4 taka per ton. Of

total sand, 80% the wholesaler sells to cement companies (where these companies issue an official

payment slip) while rest 20% the wholesaler sells to local people without keeping proper documents.

In the above-case, will any transaction value be included in GDP calculation? (assume all the

transaction has taken place within a fiscal year).

3. Read the case study and answer the followings:

Let's say, in September 2018 the Walton (Bangladesh) have manufactured 100 LED TVs

(manufacturing cost was Taka 10 million) than usually they produce in a year. But they will start

selling these TVs on July 2019. (Fiscal Year is July to June in Bangladesh)

(a) Will the cost be counted in Bangladesh's GDP FY2018-19?

(b) Instead if the company would sell these TVs by June 2019 with a value of Taka 15 million - what

would happen to Bangladesh's GDP FY2018-19?

4. Calculate the GDP by using the value-added approach for the following problem:

(a) Let's say a farmer produced paddy and sold a kg of paddy to the miller at Tk. 25. The miller

converted the paddy into rice and charges the wholesaler Tk. 30 per kg. The wholesaler adds Tk. 3

more before selling it to the retailer while the consumer finally purchased a kg of rice at Tk. 40.

(b) Can you explain double counting problem from the above stated problem in 4 (a)

5. Lest assume, Bangladesh produces only fish and crabs (two commodity economy).

Commodities

2009 2010

2009 2009 2010 2010

Quantities Price Quantities Price

(in tons) (taka per ton) (in tons) ( taka per ton)

Fish 1000 20 1100 30

Crabs 500 10 525 8

a) Calculate Bangladesh's nominal GDP in 2009 and 2010 (base year 2009)

b) Calculate real GDP for Bangladesh in 2010 expressed in 2009 dollars (hint: expressed in 2009

means base year 2009)

c) Calculate real GDP for Bangladesh in 2009 expressed in 2010 dollars

d) Calculate the real economic growth for Bangladesh economy in 2010 in compared to 2009?

(base year 2009)

e) Calculate the real economic growth for Bangladesh economy in 2010 in compared to 2009? (base

year 2010)

e) Calculate GDP deflator for the Bangladesh in 2010 and explain what does it implies? (base year

2009)

6. Calculate Bangladesh's size of GDP for 2016-17 in expenditure approach by using the

following information:

(a) Consumption in the economy was equivalent of Tk. 14,754 billion. In addition, private investment

was about Tk. 4,564 billion while government spending was Tk. 1,465 billion. At the same time,

export was equivalent of Tk. 2,971 billion while import payment was around Tk. 4,005 billion.

(b) Find out the per capita GDP of Bangladesh for a population size of 160 million?

7. Assume there are only two goods in a consumer basket orange and apple. Consumers buy

10 oranges and 5 apples respectively at Tk. 10 and Tk. 8 for each in 2009. However, in 2010

price of an orange became double while apple price raised to Tk. 12.

(a) Calculate the Consumer Price Index (CPI) for 2009 and 2010 while considering 2009 as the base

year.

(b) Explain what does CPI implies for 2010 in respect to 2009?

(c) Calculate the inflation rate for 2010?

8. Write down at least three differences between CPI and GDP deflator?

9. Answer the following questions from these tables?

(a) Calculate GDP following the expenditure approach?

(b) Calculate GDP following the income approach?

(c) Calculate GNI from the table?

(d) Compare the value of GNI with GDP and comment why one is larger than another?

Sl no. Particulars Value (in '000 USD)

1 Interest Income 150

2 Depreciation 30

3 Wages 67

4 Gross Investment 147

5 Business Profit 220

6 Sales Tax 80

7 Rental Income 90

8 Export 50

9 Import 30

10 Factor Payment from Abroad 20

11 Factor Payment to Abroad 8

12 Government Purchase 166

13 Consumption 314

Part B

9. According to the Bangladesh Labour Force Survey 2016-17 about 52.3 million people of

total population of 161.3 million were at the age group of 0-14 years. Among the working-age

population about 60.8 million people were employed and another 2.7 million were

unemployed.

(a) Find out the working-age population in Bangladesh?

(b) Find out the labour force of Bangladesh?

(c) Calculate how many millions of people are not in labour force?

(d) Calculate the labour force participation rate in Bangladesh?

(e) What is current level of unemployment rate in Bangladesh?

10. Define and put an example of frictional, structural and cyclical unemployment? What is

the natural rate of unemployment?

11. Describe the flowing concepts:

(a) Real versus nominal wage,

(b) Minimum wage versus efficiency wage

(c) What is steady-state unemployment? If fraction of job separation is 1.5% and fraction of job

finding is 23%. What will be the steady-state unemployment rate?