Pleas help answer these questions(not including 13)

6 Safari File Edit View History Bookmarks Window Help 0 2? 1)) 42%l' Sun3i37PM Q 6 EE 0 . O E V '9', U H prod,readerui.prod,mheducationcom r11 33: a Content :7 Class Professor Marotti Economics in Connect m Discussion Questions + Ill p Aa e 12. Which of the following are included in this year's GDP? Which are excluded? Explain your answers. L027.6 ' ) Interest received on an AT&T corporate bond. 9'.\" Social Security payments received by a retired factory worker. Unpaid services of a family member who painted the family home. 5\"? Income of a dentist from the dental services she provided. A monthly allowance that a college student receives from home. Money received by Josh when he resells his nearly brand-new Honda automobile to Kim. The publication and sale of a new college textbook. P'Frwrb An increase in leisure resulting from a 2-hour decrease in the length of the workweek, with no reduction in pay. i. A $2 billion increase in business inventories. j. The purchase of 100 shares of Alphabet (the parent company of Google) stock. 13. Why is gross output a better measure of overall economic activity than GDP is? How could you construct a new statistic that m focuses only on nonnal economic activity? Given what you know about the behavior of GO and GDP during the Great Recession, would you expect your new statistic to show more or less volatility than GO and GDP? Why? How would you rank the three in terms of volatility? L027.6 14. LAST WORD How do \"free\" products make the calculation of GDP more difcult? What are hedonic adjustments and why are they necessary? Will ination tend to be overstated or understated if quality improvements are not accounted for? Explain. n79REl$Gw illomslalnea an '8 Safari File Edit View History Bookmarks Window Help () 16% [4]. Sun 7:57 PM . . . prod.reader-ui.prod.mheducation.com C Content Course Hero Class Professor Marotti Economics in Connect M Assessing the Economy's Performance + Aa () ) Gross Domestic Product The primary measure of an economy's performance is its aggregate output, or total output, of goods and services. There are several ways to measure aggregate output. The one favored by the Bureau of Economic Analysis is gross domestic product (GDP), or the dollar value of all final goods and services produced within a country's borders during a specific period of time, typically a year or a quarter. Page 514 Final Products Only Note that GDP only counts the value of final goods and services, that is, products that are purchased by their end (final) users. GDP excludes intermediate goods and services that are purchased for resale or as inputs used to produce other products. Thus, a loaf of bread that is purchased by a family for a camping trip is counted in GDP (because the family is the end user) while an identical loaf that is purchased by a sandwich shop is not counted in GDP (because the sandwich shop will be using the loaf of bread as an input to the production of its final product, sandwiches). Domestic Output Only GDP includes only the value of final goods and services produced within a nation's boundaries. Thus, the value of the cars produced at a Japanese-owned Toyota factory in Ohio would count as part of U.S. GDP (because the factory is located in the United States) but the value of the trucks produced at an American-owned Ford factory in Canada would not (because the factory lies outside the borders of the United States). What matters for GDP is where the final output is produced, not who makes it or who consumes it. 9 ? A "tv 86 Safari File Edit View History Bookmarks Window Help 0 43,3 1)) 29%9} Sun8108PM Q 6 EE . O E V K\" D _E H prod,readerui.prod,mheducationcom C [:1 333 a Content u Course Hero :7 Class Professor Marotti Economics... m Discussion Questions E Summary + E ,0 Aa e 4 L027.1 Define and measure gross domestic product (GDP). Gross domestic product (GDP), a basic measure of an economy's economic performance, is the market value of all nal goods and services produced within a nation's borders in a year. Final goods are those purchased by end users, whereas intermediate goods are those purchased for resale or for further processing or manufacturing. Intermediate goods, nonproduction transactions, and secondhand sales are excluded in calculating GDP. L027.2 Determine GDP by summing all expenditures on final goods and services. GDP may be calculated by summing total expenditures on all nal output or by summing the income derived from the production of that output. By the expenditures approach, GDP is determined by adding consumer purchases of goods and services, gross investment spending by businesses, government purchases, and net exports: GDP = C + I g + G + X ,1. Personal consumption expenditures consist of expenditures on goods (durable goods and nondurable goods) and services. About 60 percent of consumer expenditures in the United States are on services, leading economists to refer to the US. economy as a service economy. Gross investment is divided into (a) replacement investment (required to maintain the nation's stock of capital at its existing level) and (b) net investment (the net increase in the stock of capital). In most years, net investment is positive, and therefore the economy's stock of capital and production capacity increase. ?i'$@@w lIIGmsI-T'nga an '8' 6 Safari File Edit View History Bookmarks Window Help 0 43,3 1)) 29%9} Sun8108PM Q 6 EE . O E V K\" D _E H prod.readerui,prod.mheducation.com C [:1 333 a Content u Course Hero :7 Class Professor Marotti Economics... m Discussion Questions E Summary + E ,0 Aa e L027.3 Determine GDP by summing all incomes received for providing resources. 4)) By the income or allocations approach, GDP is calculated as the sum of compensation to employees, rents, interest, proprietors' income, corporate prots, and taxes on production and imports, minus net foreign factor income, plus consumption of xed capital and a statistical discrepancy. L027.4 Describe the relationships among GDP, net domestic product, national income, personal income, and disposable income. Net domestic product (NDP) is GDP minus the consumption of xed capital. National income (N1) is total income earned by a m nation's resource suppliers plus taxes on production and imports; it is found by subtracting a statistical discrepancy from NDP and adding net foreign factor income to NDP. Personal income (PI) is the total income paid to households before they pay personal taxes. Disposable income (D1) is personal income after households have paid personal taxes. DI measures the amount of income available to households to consume or save. L027.5 Distinguish between nominal GDP and real GDP. Nominal (current-dollar) GDP measures each year's output valued in terms of the prices prevailing in that year. Real (constantdollar) GDP measures each year's output in terms of the prevailing prices in a selected base year. Because real GDP is adjusted for price-level changes, differences in real GDP are due only to dierences in production activity. Economists use a GDP price index to convert nominal GDP to real GDP. my? moose loss-avast: an e 6