Tuesday, July 14, 2009

Please help me in my macroecon test coming up?? Thanks.?

1.Would the following be counted in GDP? If so, explain how it enters GDP (C, I, G, or (X-M)) and why. If not, explain why not.



a.Nabisco鈥檚 purchase of flour to make cookies.



b.Your purchase of flour to make cookies for your study group.



c.The Pentagon鈥檚 purchase of flour to make cookies for soldiers.



d.Nabisco鈥檚 purchase of an oven to bake cookies.



e.Your purchase of Hungarian hazelnuts to put in your cookies.



According to Okun鈥檚 Law, how much output would be lost if the nation鈥檚 unemployment rate increased from 4.6 to 5.4 percent?



Please help me in my macroecon test coming up?? Thanks.?finance





All except e are in GDP.



a is part of C



b is part of C



c is part of G--government spending



d is part of I--investment to increase productive capacity



e is not domestic product.

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