Economics 252 – Review Questions Chapter 5 – Answers to Questions (1) to (7)

(1) (c) $3,000,000. The numbers will be changed here for the exam.

(2) (b) of goods that are produced by foreign firms in the United States. Note that I could ask you about other differences between GNP and GDP. For example, GNP would include goods that are produced by US firms in foreign countries, but GDP would not. Just be sure that GDP refers to a geographic concept, and GNP refers to a nationality concept.

(3) (c) GDP per capita.

(4) (d) $26,048. Note, this is calculated by $6,928.8 billion/.266 billion = $26,048. The numbers will be changed here for the exam.

(5) (b) automobile tires purchased by an auto manufacturing company. Note that here you should know the difference between an intermediate good or service, and a final good or service. I will have a different set of examples of intermediate and final goods/services here.

(6) (d) $15. The numbers will be changed here for the exam.

(7) (c) $6,786.3 billion. (rather than the (c) answer $6,786.4 billion). Note, this is calculated by $7,241 billion/ 1.067 = $6,766.3 billion. The numbers will be changed for the exam.