84 CHAPTER 7

27. Nominal GDp was $3774 billion

GDP deftator was 108 and nominat
in year i theand
year 2 and the GDp deflator
GDd;;" $3989 in Allocations:
that year was t f i. What was lncome approach
,..'] real GDp in years 1 and Z, respectivetyi - Item Amount
lli
(a) $g+g+ billion and $3562 biltion $--
(b) $gg3g biilion and $3695 biilion $_
(c) $gsgS bittion and $0725 biltion $_-- $.--.-
(d) $s0+s biilion and $3854 binio; $__- $_
year was 148, and rhe next year $=_- $_
31.-tg,::..,ndex,one
was "167. What it
is the approximate percentaje cnange
the price level from one year to the in $_-
neX as [reasured by
that index? $_-
(a) 1z::/" $_
(b) 13% National
(c) 14% income $
(d) 15%
s-_-
29. GDp accounting includes
(a) the goods and services produced $_.--
in the under- $_
ground economy Gross domestic
(b) Gross domestic
expenditures for equipment to reduce product
product
the pollution $
of the environment
n"
(c) the value of the leisure enjoyed b. Use the other national accounts to find
by citizens
(d) the goods and services pioOr.jnui-n-ot
and sold in the markets of tfre oought (1) Net domestic pioduct is Jr
economl-
30. Whjch is a major reason why (2) Nationalincome is s
index of society,s economic wetibeing?- '-'- accurate
GDp is nof an
(3) Personal income is s
(a) lt includes changes in the valLie
(b) lt excludes many- improrern"nt" ofp[ir",
leisure. (4) Disposable income is s
i" quatily.
(c) lt includes transactions from tne
:
unOurgrounO 2. A larmer owns a plot of ground and
,l: economy. sells the right to
ll
(d) pump crude oil from his land to a crude oil proJucer.
It excludes transactions from the
i buying and sell- crude oil producer agrees to pay the The
i;
ii
ing of stocks. furruislo a barrel
for every barrel pumped from tn"
i)
rrrr"rtluli.
a. During one year 10,000 barrels urrprrp"O.
ii, r PROBLEMS
(1) The farmer receives a payment
of :b
from the crude oil producer.
1- Following are national income accounting
the figures for (2) The value added by the
United States. farmer is
b. The crude oil producer sells
the 10,000 barrels
pumped to a petroleum refiner
Billions at a price of $25 a
of dollars barrel.
r Exports (1) The crude oil producer receives
r Dividends $ 367 a payment of
r Consumption of fixed
,
capital
60
tl07
$ from the refiner.
Compensation of employees (2) The value added by the
- Government purchases 17?-2 crude oil producer is
, Rents 57'/
- lndirect business taxes i]3
refiner employs a pipeline company
', Gross private domestic investment :?5t,
4:)/
l.
portIl,"
the crude oil from the farmer,s funJ
to trans_
Corporate income taxes io tne retin_
Ai;7:::y
pavments
I
utJ
|;r( ) :II."r9 pays the pipetine company a fee of g.t a bar_
rel for the oil transported.
. Proprietors, income jro I
(1) The pipeline company receives
. Personal consumption expenditures l:1') a payment of
I810 6
r lmports
')'t() from the refiner,
Social Security contributions
,/( Undistributed corporate prof its I /18 (2) The value added by the com pany
is
I Personal taxes
Net foreign factor income earned
in the U.S.
:) /'/,
0
d. From the 10,000 barrels of crude
duces 315,000 gallons of gasoline
oil, the refiner
and various by-
pro_ \
products which are sold to distributors
a. ln the following table, use any of and gaso line
thesc fir;tircs Ir.r service stations at an average price gl per gallon
prepare an income statement of
for the econonty similar (1) The total payment received
to the one found in Table 7.3 of by the refiner from its
the text. customers is