Solve the problem.
1. Gross domestic product is:
a.is the dollar value of all the final goods and services within the border of a nation.
b.includes intermediate and final goods and services.
c.minus an allowance for deprecation of fixed capital equals GNP.
d.is a less than perfect measure of social well-being because it does not include exports and imports.
e.all of the above.
2. Intermediate goods are goods and services used:
a.by state and local governments.
b.as inputs.
c.by the ultimate user.
d.both as inputs and final goods.
3. The circular flow of economic activity is a diagrammatic model of the:
a.influence of government on business behavior.
b.flow of goods, resources, payments, and expenditures between the sectors of the economy.
c.influence of business on consumers.
d.role of unions and government in the economy.
4. The lower portion of the circular flow model contains factors markets in which households provide:
a.labor, money and machines.
b.savings, spending, and investment.
c.natural resources, labor, and capital
d.output of all final goods and services produced.
5. Based on the circular flow model, money flows from households to businesses in: a.factor markets.
b.product markets.
c.both factor and product markets
d.neither factor nor product markets.
6. Using the expenditure approach to calculate GDP, total spending by households for durable goods, nondurable goods and services is a category called: a. gross private domestic investment.
b.capital consumption allowance.
c.personal consumption expenditures.
d.household investment.
7. With the expenditure approach, new residential housing in counted in GDP as a (an):
a.durable consumption good.
b.household durable good.
c.investment good.
d.inventory expansion.
e.long-term durable good.
8. Which of the following would not be included in the government consumption expenditures and gross investment (G) category of GDP? a. The payments made to Social Security recipients.
b.The expenditures made to repair a highway.
c.The spending for professors at state universities.
d.The purchase of new china for White House functions.
9. If exports fall and imports rise, then (ceteris paribus):
a.GDP will increase.
b.GDP will decrease.
c.GDP will remain unchanged.
d.net exports will fall.
e.transfers will rise.
10. When GDP is measured as the total payments made to households that furnish the resources used to produce the final goods and services, it is known as: a.net national product.
b.the depreciation approach.
c.the income approach.
d.the aggregate demand approach.
e.the expenditure approach.
11. Using the income approach, the largest component in the calculation of GDP is: a.net interest.
b.rental income.
c.profits
d.compensation of employees.
12. Using the income approach, an indirect business tax is a (an): a.sales tax.
b.excise tax.
c.license fee.
d.all of the above.
13. Using the income approach, an estimate of the value of capital worn out producing GDP is:
a.indirect business taxes.
b.capital consumption allowance or depreciation.
c.gross private domestic investment.
d.capital erosion estimate.
14. If a man marries his hired housekeeper, the value of GDP: a. rises.
b.falls.
c.is unchanged
Explain your reasoning for your answer above in a complete sentence or two.
15.According to the author, GDP is a less than perfect measure because it excludes what 5 factors? Name each factor and give an example for each.
16.Gross domestic product that is based on existing prices is called ________________, while GDP valued at prices in a base year is known as ______________.
17.Assume in 1995 that US nominal GDP was $2,784 billion and the GDP chain price index is 60.4. Real GDP in 2000 dollars is: A. $1,682 billion.
b.$4,609 billion.
c.$3, 889 billion.
d.$7,789 billion.
18. Clearly state how you think the British Petroleum disaster in the Gulf of Mexico in the summer of 2010 impacted GDP? Would you predict that GDP increased, decreased or remained the same? Be sure to use each of the components in either the expenditure or the income approaches to GDP (but not some from both) to validate your opinion. Begin by selecting and indicating which approach you are using. Note that this is not a research question where you look up how GDP actually performed in the months following the spill. Rather it asks you to demonstrate your understanding and application of the major concepts and components of GDP as discussed in Chapter 15...
Q4. Pistaferri opens his 2003 paper on the intertemporal labor supply effects of wage changes with the following: "A long-standing question in labor economics is whether and to what extent individual labor supply responds to anticipated wage changes (also known as evolutionary wage changes). This effect is measured by the intertemporal elasticity of substitution..." a. Why is it important that wage changes used to identify the intertemporal labor supply elasticity use only anticipated changes in wages? Discuss the expected sign of the labor supply response to anticipated wage changes. If some of the wage changes are unanticipated, what will be the likely effect on the estimated labor supply response? Why? b. Pistaferri (2003) has data on individual's subjective expectations of their future wage growth, which he utilizes to decompose observed wages into three components: a. Anticipated, evolutionary movements in the wage over individuals' lifecycles b. Unanticipated permanent shifts in the future profile of wages c. Unanticipated transitory changes in wages Describe the expected effect of each of these components of wages on an individual's labor supply, drawing on standard models of utility maximization (leisure and consumption choice) over the lifecycle. C. Pistaferri's preferred estimate of the intertemporal labor supply elasticity for men (based on his measure of anticipated movements in the wage) is approximately 0.7. Compare this with the range of estimates of the intertemporal labor supply elasticities presented by MaCurdy (1981) or Altonji (1986). What might be responsible for differences in the estimates across these authors? What does it suggest about interpretation of the within-person relationship between labor supply and observed wages? Q5. Use this question to demonstrate your knowledge about empirical methods in Labor Economics. For each part, be as precise and comprehensive as possible. You are trying to measure the causal impact of college education on labor market outcomes. As an initial specification, you estimate with OLS, including a dummy variable for "College Graduate" as well as several control variables. Your focus is on the coefficient on College Graduate. You have data on many sets of siblings; where for each person you know their education level, labor market outcomes, who is related to whom, and each individual's covariates. A. Describe the "standard reasons" why we should be concerned about biased coefficients from estimating by OLS. B. What problems with OLS will propensity-score matching help to solve? What problems will it not help to solve? A colleague suggests adding "family fixed effects" to your specification. C. In what key ways does this change the nature of the identifying variation? D. What types of biases do family fixed effects help to remove? E. What are some ways that this strategy could still lead to biased results? F. Are there reasons why this strategy could increase the bias? Describe why or why not. G. What are the reasons why this strategy might not lead to biased estimates, but still give different results than OLS estimates? For this last part of the question, put aside issues of biased coefficients. You are concerned about statistical inference, and consider bootstrapping. H Describe as carefully as possible how you would implement this. What exact steps would you take? (Note: do not describe the Stata command(s) you would use. Instead, describe the conceptual steps involved.) I. If you decide to not bootstrap, what would you do to get correct statistical inference?Does every game have at least one subgame? Does every game have a proper subgame? Does every simultaneous game have a proper subgame? Does every game have a pure Nash Equilibrium? Does every game have at least one mixed Nash Equilibrium? Does every game have at least one Nash Equilibrium (either pure or mixed)? Does every game have multiple Nash Equilibrium? As a result of applying iterative elimination of weakly dominated strategies in a game, does one obtain all pure Nash Equilibria of that game? As a result of applying iterative elimination of strictly dominated strategies in a game, does one obtain all pure Nash Equilibria of that game? Is every game dominance solvable? Is every Nash Equilibrium also a Subgamc Perfect Nash Equilibrium? Is every Subgame Perfect Nash Equilibrium also a Nash Equilibrium? In simultaneous games, is every Subgame Perfect Nash Equilibrium also a Nash Equilibrium? In sequential games, is every Subgame Perfect Nash Equilibrium also a Nash Equilibrium? Is it more convenient to present simultaneous games in normal form and sequential games in extensive form? Can a weakly dominated strategy be part of a Nash Equilibrium? Can a strictly dominated strategy be part of a Nash Equilibrium? Is every weakly dominant strategy also a strictly dominant strategy? Is every weakly dominated strategy also a strictly dominated strategy? Is every strictly dominant strategy also a weakly dominant strategy? Is every strictly dominated strategy also a weakly dominated strategy? Does every game have a weakly dominated strategy? Does every game have a strictly dominated strategy? For this problem, carry at least four digits after the decimal in your calculations. A random sample of 5,240 permanent dwellings on an entire reservation showed that 1,683 were traditional hogans. In USE SALT (a) Let p be the proportion of all permanent dwellings on the entire reservation that are traditional hogans, Find point estimates for p and q. (Round your answers to four decimal places.) PI (b] Find a 94%% confidence interval for p. Find the maximal margin of error, E. (Round your answer to three decimal places.) Report the bounds from the 94% confidence interval for p. (Round your answers to three decimal places,) lower limit upper UmA Give a brief interpretation of the confidence interval, C).94%% of the confidence intervals created using this method would Include the true proportion of traditional hogans 6 of the confidence intervals created using this method would include the true proportion of traditional hogans awof all confidence intervals would include the true proportion of traditional begins @3% of all confidence intervals would include the true proportion of traditional hagans. (c) Do you think that no >'5 and no s'5 are satisfied for this problem? Explain why this would be an important consideration. No, the conditions are not satisfied. This is important because it allows us to say that p is approximately binomial. No, the conditions are not satisfied, This is important because it allows us to say that pis approximately normal. Yes, the conditions are satisfied, This Is important because It allows us to say that p in appropriately normal. You, the conditions arm satisfied. This is important because it wily
