Reference no: EM132171251
Assignment Questions
1) The table below shows the national income accounts for a hypothetical country,Metrica.
Metrica's National Accounts
($ billions)
Corporate income 98
Exports 68
Wages and salaries 546
Net international income to the rest of the world 8
Gross investment 157
Government purchases 184
Indirect taxes 75
Personal consumption 490
Imports 27
Depreciation 79
Proprietors' incomes and rents 56
Statistical discrepancy
a) What is the income-based estimate of Metrica's GDP?
b) What is the expenditure-based estimate?
c) What is the value of the statistical discrepancy that is added to the lower estimate and subtracted from the higher estimate to find a single GDP value?
d) By how much is Metrica's capital stock expanding or contracting?
2) Identify whether or not each of the following transactions would be included in GDP, and, if it is included in GDP, which expenditure component it is part of. (6 marks; 1 mark each)
a) The City of Toronto hires a construction company to rebuild the Gardiner Expressway.
b) A homeowner grows tomatoes in her garden.
c) A German consumer purchases a hockey stick from a company based in Quebec.
d) TD Bank purchases new computers for its head office.
e) A homeowner purchases a new lawnmower.
f) A homeowner purchases a new Yamaha lawnmower, manufactured in Japan.
3) The table below gives data on Student A's monthly purchases during 2014 and 2015.
Student A's Monthly Purchases
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Prices
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Quantities Consumed per month
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(2014)
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(2015)
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(2014)
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(2015)
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Hotdogs
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$1.50
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$1.60
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3
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2
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Cans of cola
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.75
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.70
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16
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18
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Chocolate bars
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1.00
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1.00
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7
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7
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Magazines
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3.50
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4.50
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3
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2
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Movies
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3.00
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2.75
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2
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3
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a) Calculate the value of Student A's 2014 shopping basket using 2014 prices.
b) Calculate the value of Student A's 2014 shopping basket using 2015 prices.
c) If 2014 is used as the base year, what is the 2015 value of Student A's price index?
d) What is the 2014 value of this index?
e) By what percentage has this index changed between 2014 and 2015?
4) The table below shows labour force information for a hypothetical economy.
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2014
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2015
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Total population 15 years and over
Those 15 years and over not in the labour force population
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4.2 million
1.4 million
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4.2 million
1.4 million
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Part-time workers who wish to have hill-time jobs
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100 000
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125 000
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Part-time workers who do not wish to have kill-time jobs
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300 000
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375 000
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Discouraged workers
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400 000
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500 000
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Workers with kill-time jobs
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1.2 million
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1.3 million
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Unemployed members of the labour force
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150 000
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160 000
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a) Calculate the labour force population, labour force, participation rate, and official unemployment rate in 2014. Then, calculate values for the same variables in 2015.
b) Has the official unemployment rate risen or fallen between 2014 and 2015?
c) Calculate, for both 2014 and 2015, what the unemployment rate would be if it included underemployed and discouraged workers.
5) Identify which type of unemployment best describes the situation of each of the following individuals.
a) A farm worker who is unemployed during the winter months.
b) A recent journalism graduate is looking for their first job in the industry.
c) A graphic designer loses her job during an economic recession.
d) A laid-off typesetter who so far has had no success finding a similar job due to the replacement of typesetters by computers.
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