Econ homework 8

The output of U.S. citizens who work in Canada would be included in the

gross domestic product of Canada.

The purchase by a foreign government of an airplane produced in the United States is included in U.S.

net exports.

Real GDP will increase

only if the quantity of final goods and services produced rises.

If the GDP deflator rises from 185 to 190, what is the rate of inflation between the two years?

2.7%

Which of the following headlines would be more closely related to what macroeconomists study than what microeconomists study?

Real GDP grows by 2.3% in the second quarter.

Increases in real GDP would understate the well-being of a country over time if, over that time period, the

amount of pollution decreased.

Investment, as defined by economists, would include the purchase of a

computer by an accounting firm.

If the size of the underground economy is large,

government agencies have difficulty measuring nominal and real GDP.

A sharp increase in the divorce rate increases the number of lawyers hired to determine divorce settlements. This will

increase GDP and decrease well-being in the economy.

If the quantity of goods and services produced in the economy decreases,

it may be possible for nominal GDP to increase.

In periods when prices are falling, on average,

real GDP will grow faster than nominal GDP.

When consumers are less confident about their jobs or incomes, they are more likely to

reduce purchases of durable goods than nondurable goods

Suppose that nominal GDP in 2016 was less than real GDP in 2016. Given this information, we know for certain that

the price level in 2016 was less than the price level in the base year.

Suppose in 2016, you purchase a house built in 2003. Which of the following would be included in the gross domestic product for 2016?

the value of the services of the real estate agent