Question

Please google these topics and look at U. S. Bureau of Labor Statistics to get better understanding of these topics.

1. Calculate GDP, NDP, NI, PI, and DI from the following information. All numbers are in billions of dollars.

Wages $ 26,500

Consumption Expenditures $36,000

Government Expenditures $18,500

Imports $20,330

Exports $18,580

Property Taxes $16,000

Sales Taxes $9,715

Retained earnings $1,310

Personal Income Taxes $2,200

Private Domestic Investment Expenditures $15,650

Interest Income $1,940

Pay Roll taxes $1,300

Transfer Payments $880

Depreciation $1,300

Net Income Made Abroad by Americans $160

Indirect Business taxes $2,520

Corporate Income Taxes $320

2. Calculate a) labor force, b) labor force participation rate, and c) unemployment rate if the population of a country is 380 million people out which 92 million are under the age of 16, 58 million don't want to work and 20 million are looking for work.

3. Calculate the inflation rate from 2004-2005 if the index number in 2005 was 120 and the index number in 2004 was 135.

Answer 1

1

(a) GDP = Consumption expenditure + Private Investment Expenditure + Government expenditure + net export (Export - Import)

= 36,000 + 15,650 + 18,500 + (18,580 - 20,330)

= $ 68,400

(b) NDP = GDP - Depreciation

= 68400- 1300

= $ 67100 billions

(C) NI= NDP +NFIA -indirect business tax.

= 67100 +160 -2520

= $ 64740 billions

D) PI= NI (NNPfc) - Retained earning -Corporate income tax- Pay roll taxes +Transfer payment.

= 64740 - 1310- 320-1300+880

= 62690 billions

E) DI= PI - Personal income tax.

62690 - 2200

=60490 billions

2.

A) Labor force=380 -92 -58 = 230million

B) labor force participation rate= labor force / working population *100

= (230 / (380-92))*100%=79.86

C) unemployment rate= (unemployed / labor force ) *100

= 20 / 230 * 100% = 8.695%

3.

inflation rate = (CY index - P Y Index/ PY index ) * 100

120 - 135 / 135 *100

= - 11.11%