1. A friend of yours is reading a financial blog and comes to you for some advice about GDP. She wants to know whether she should pay attention to nominal GDP or real GDP. Which one do you recommendand why?
2. Is a larger GDP always better than a smaller GDP? Explain your answer with an example.
3. If max receives an unemployment check, would we include that transfer payment from the government in this year's GDP? Why or why not?
4. Phiil owns an old set of golf clubs that he purchased for $1000 seven years ago. He decides to post them on Craigslist and quickly sell the clubs for $250. How does this sale affect GDP?
5. What three issues are at the center of the debate regarding the accuracy of the CPI? Give an example of each issue.
6. If the price of homes go up by 5% and the prices of concert tickets rise by 10% which will have the larger impact on the CPI?
7. If a country is experiencing a relatively high rate of inflation, what impact will this have on the county's long-term rate of economic growth?
8. In a sentence or two, evaluate the accuracy of the following statement, including a clear and precise statement of historical comparison: Inclination in the United States last year was 0%. This is close to the historical level
9. What are the seven problems caused by inflation?