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Exports
1,850
Imports
2,000
2/2
ortance of measuring per capita GDP?
b. Why nominal GDP can be misleading?
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Do you believe that China is guilty of unfair trading
practices including currency manipulation?
Due Date is August 1
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0
Discuss the economic impact of the NBA and NFL
Due date is August 3
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should be at least 300 words) to receive full points.
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1. Provide the formula for the expenditure approach to GDP accounting and include an example
of each category of spending.
2. Suppose a consumer buys 10 units of good X and 20 units of good Y every year. The following
table lists the prices of goods X and Y in the years 2005-2007. Assume that these two goods
constitute the typical market basket. Calculate the price indices for these years with 2005 as the
base year. Comment on the inflation picture for these years.
Year
Good X
Good Y
2005
$3
$6
2006
4
7
2007
4.5
7.5
3. Using the expenditure approach, calculate GDP using the following data.
Item
Amount in dollars (billions)
Consumption
10,000
Consumption of Durable Goods
2,000
Consumption of Non Durable Goods
2,800
Consumption of Services
3,200
Investment
5,000
Fixed Investment
1,000
Government purchases of Goods & Services
3,000
Government Transfer Payments
450
Exports
1,850
Imports
2,000
GDP Equals
4. a. What is the importance of measuring per capita GDP?
b. Why nominal GDP can be misleading?
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MICROECONOMICS
Microeconomics
Student’s Name
Institutional Affiliation
2
MICROECONOMICS
Microeconomics
1. Formula for the expenditure approach to GDP
Expenditure approach to GDP =Consumption + Investment + Government expenditure + exports
– imports also, = C, I, G and (X-M)
Example: Using U.S.A. Bureau of Economic Analysis released in 2013, the Gdp can be
calculated as C= goods and services which amounted to 11,373
I= change in inventories, structures, software, equipment = 2,1,51
G...
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