ECON 212 || QUESTIONS WITH 100% SOLVED
SOLUTIONS!!
GDP correct answers Gross Domestic Product- the total market value of all final goods and
services produced annually in an economy
GDP per capita correct answers The market value of all final goods and services produced
within a country in a year divided by the population
The growth rate of GDP tells us correct answers How quickly a country's production is rising
or falling over time.
What is the best measure of a country's changing living standards? correct answers Growth in
real GDP per capita
Factor Income Approach correct answers Y= wages + rent + profit + interest
GDP delflator correct answers Nominal GDP/Real GDP (100)
Expenditure Approach correct answers Y= C + I + G + NX
What does C stand for? correct answers Consumption
What does I stand for? correct answers Investment
What does G stand for? correct answers government purchases
What does NX stand for? correct answers Net export (export-import)
What are the problems with GDP as a measure of income? It doesn't count... correct answers
the underground economy, non priced production, leisure, environmental costs, and the
distribution of income
Rule of 70 correct answers doubling time= 70/growth rate
What are the ultimate causes of GDP growth? correct answers property rights, honest
government, political stability, dependable legal system, and open and competitive markets
What are the proximate causes of GDP growth? correct answers physical capital, human
capital, and technological knowledge
Production function correct answers Y= f (A,K,L)
What does A stand for? correct answers technological knowledge
What does K stand for? correct answers Physical capital
What does L stand for? correct answers Human capital
SOLUTIONS!!
GDP correct answers Gross Domestic Product- the total market value of all final goods and
services produced annually in an economy
GDP per capita correct answers The market value of all final goods and services produced
within a country in a year divided by the population
The growth rate of GDP tells us correct answers How quickly a country's production is rising
or falling over time.
What is the best measure of a country's changing living standards? correct answers Growth in
real GDP per capita
Factor Income Approach correct answers Y= wages + rent + profit + interest
GDP delflator correct answers Nominal GDP/Real GDP (100)
Expenditure Approach correct answers Y= C + I + G + NX
What does C stand for? correct answers Consumption
What does I stand for? correct answers Investment
What does G stand for? correct answers government purchases
What does NX stand for? correct answers Net export (export-import)
What are the problems with GDP as a measure of income? It doesn't count... correct answers
the underground economy, non priced production, leisure, environmental costs, and the
distribution of income
Rule of 70 correct answers doubling time= 70/growth rate
What are the ultimate causes of GDP growth? correct answers property rights, honest
government, political stability, dependable legal system, and open and competitive markets
What are the proximate causes of GDP growth? correct answers physical capital, human
capital, and technological knowledge
Production function correct answers Y= f (A,K,L)
What does A stand for? correct answers technological knowledge
What does K stand for? correct answers Physical capital
What does L stand for? correct answers Human capital
