Quantitivative Economic Problems

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ECON 305

QUANTITATIVE ECONOMIC PROBLEM ----------- (5% of final grade)

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Posted on-line -------June 9, 2009

Due on-line ------------ June 15, 2009 at 11:59 pm EST

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I. Expenditures Approach to Calculating GDP (weight 25%)

Complete the following exercise:

Go to http://www.bea.gov/

Find the information on GDP in billions of current dollars for 2008 quarterly and for the first quarter of 2009 ( (in GDP and the National Income and Product Account (NIPA) Historical Tables – table 1.1.5 – choose First Year -2008 (A&Q), Last Year 2009 (Q), Series - Q). Using this data calculate the composition of GDP in the United States.

Write a short report in your own words (about half a page, double-spaced), which contains the analysis of the results you have gotten. In this report consider, but do not be limited to the following:

1. In 2008 quarterly - first quarter of 2009, what was the main component of GDP in aggregate output?

2. In 2008-2009, what was the smallest component of spending?

3. Were net exports positive or negative? What does it mean to say that net exports are positive or negative?

II. Income Approach to Calculating GDP (weight 25%)

Complete the following exercise:

Go to http://www.bea.gov/

Find the information on GDP in billions of current dollars for 2008 (in GDP and the National Income and Product Account (NIPA) Historical Tables – table 1.7.5 - Choose 2008 - annual).

Write a report in your own words (about 1 page, double-spaced), which contains the analysis of the results you have gotten. In this report consider, but do not be limited to the following:

1. What is the difference between gross domestic product (GDP) and gross national product (GNP)?

2. Based on the table, what calculations must you...