Question 1

To estimate GDP you add the value of all the goods and services produced, both final and
intermediate goods. Is this procedure correct? Why? Double counting
Question 2
Does my purchase of a domestically produced Toyota car that was manufactured in 2010 add
to the current UK GDP? Why? How about my purchase of a domestically produced, new
Toyota?
Question 3
In 1900, the average work week was 65 hours; today it is approximately 35 hours. How did
this change affect real GDP within the UK? How did it affect the standard of living within the
UK? Comment on your answers. - Reduce real GDP (số giờ làm giảm)
- not sure about standard of living
Question 4
Classify each of the following items as a final good or an intermediate good and identify
which is a component of consumption expenditure, investment, or government expenditure
on goods and services.
• Banking services bought by a student.
• New cars bought by Hertz, the car rental firm final - investment
• The purchase of a new aircraft for the Prime minister.
• New house bought by Adele in Brighton. investment because of new house

• Soya Milk bought by the Atrium this morning. intermediate

Exercise 1
The table shows data from the United Kingdom in 2005
GDP = C + I + G + EX - IM

C = 791
I = 209
G = 267

a. Calculate GDP in the United Kingdom. 1223

b. Explain the approach (expenditure or income) that you used to calculate GDP.
Exercise 2
Desert Kingdom produces only dates and camel rides. The base year is 2014, and the tables
give the quantities produced and the prices in 2014 and 2015.

Calculate Desert Kingdom’s

a. Nominal GDP in 2014 and 2015.
b. Real GDP in 2015 in terms of the base-year prices.