Question

Which of the following is not included in the calculation of GDP?

a. Joey's Electronics manufactures CD players that individuals install in cars that do not have CD players.

b. Susy's Leather Goods manufactures leather pieces that are sold to manufacturers that produce handbags and wallets from these leather pieces. c. Harrys Ice Cream Shoppe sells ice cream cones at the beach.

d. Monica's Hair Salon sells haircuts and manicures to the residents of Marco Island.

GDP tends to understate our economic well being because it:

A)     includes the value of services produced in the home.

B)     excludes the value of leisure.

C)     includes expenditures on crime prevention equipment.

D)     includes health care costs related to the consumption of cigarettes.

. A) it-nominal production GDP of in 2009 2009 is is higher higher than than nominal production GDP in of 2008, 2008, while we can prices state remain that: unchanged.

B) production or prices or both are higher in 2009, compared to 2008.

C) prices in 2009 are higher than prices in 2008, while production remains unchanged. D) production in 2009 has gone down while prices have increased.

If a country has a working-age population of 200 million, 135 million people with jobs, and 1 5 million people unemployed and seeking employment, then its labor force is: A) 335 million. B) 200 million. C) 155 million. D) 150 million.

Answer 1

1.
The correct answer is b
b. Suzy's leather Goods manufactures leather pieces that are sold to manufacturers that produce handbags and wallets from these leather pieces.
These are intermediate goods and hence are not a part of GDP calculation.
2.
The correct answer is B.
B) excludes the value of leisure.
Since it excludes the value of leisure the actual value is lower.
4.
The correct answer is D.
D) 150 million
Labor Force=employed+Unemployed
=135+15
=150 million