Which Of The Following Are Actually Included In Deriving This Year's GDP?
2. Why is GDP considered a limited measure of societal well-being and progress and outline two alternative measures that have been developed to address some of the limitations of GDP?
a. Which of the following are actually included in deriving this year’s GDP? Explain your answer in each case.
(Real GDP is the money GDP adjusted for inflation by an implicit price deflator)
social security payments received by a retired factory worker(real GDP)
the services of a professional painter in painting someone else’s home(the price is according to current market ,Money GDP)
i. the services of your Dad painting the family home
the income of a dentist(the price is according to current
market is money GDP)
the money received by Smith when he sells a 2010 Holden to Jones(According to the previous year, is not current price ,real GDP)
the monthly allowance that a college student receives from home(depending on the consumption of the first month for you, that is base month. Real GDP)
rent received on a two-bedroom flat(Money GDP)
b. Explain why if Ms Daisy marries her chauffer, then national income is diminished, ceteris paribus.
4. Draw a simple five sector circular flow diagram. Place government at the head of the diagram to depict its unique role as the issuer of the sovereign currency. Then add the following into your diagram and label these as either injections into or leakages from the circular flow of income: i. Taxation ii. Imports iii. Investment iv. Exports v. Government spending
a. Which of the following are actually included in deriving this year’s GDP? Explain your answer in each case.
(Real GDP is the money GDP adjusted for inflation by an implicit price deflator)
social security payments received by a retired factory worker(real GDP)
the services of a professional painter in painting someone else’s home(the price is according to current market ,Money GDP)
i. the services of your Dad painting the family home
the income of a dentist(the price is according to current
market is money GDP)
the money received by Smith when he sells a 2010 Holden to Jones(According to the previous year, is not current price ,real GDP)
the monthly allowance that a college student receives from home(depending on the consumption of the first month for you, that is base month. Real GDP)
rent received on a two-bedroom flat(Money GDP)
b. Explain why if Ms Daisy marries her chauffer, then national income is diminished, ceteris paribus.
4. Draw a simple five sector circular flow diagram. Place government at the head of the diagram to depict its unique role as the issuer of the sovereign currency. Then add the following into your diagram and label these as either injections into or leakages from the circular flow of income: i. Taxation ii. Imports iii. Investment iv. Exports v. Government spending