Answer the following questions?

1. Explain how buying a shirt contributes to the GDP. Relate it to all four parts of the definition of GDP: dollar value, final goods and services produced within a country's borders, and in a given year.

2. How is the expenditure approach different from the income approach to calculating GDP?

3. Categorize each of the following as a durable good or a nondurable good: a car, a microwave oven, a can of tomato sauce, a pair of pants, a cleaning product, a ceiling fan.

4.Suppose the nominal GDP for year A is $500,000 and the nominal GDP for the same economy in year B is $400,000. The real GDP for year A is $500,000, and the real GDP for year B is $500,000. The same amount of goods and services were produced each year. What happened to the prices of goods and services between year A and year B? Explain.

5. Give an example of each of the following limitations of GDP: nonmarket activities, the underground economy, negative externalities, and quality of life.

6. How is gross national product related to gross domestic product?

7 One of the measures derived from GDP is personal income. If personal income is on the rise, how would you expect the GDP to reflect this?

8. How does the aggregate supply change as GDP rises? How does aggregate demand change as GDP rises?

9. Refer to the Equilibrium Aggregate Supply and Demand Graph. How will a shift to the right in an AD curve affect the equilibrium GDP and the equilibrium price level?