Expert Solutions

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C11-TQ7. Adding to table 11.1, if real GDP in 2002 were $10,048.8 billion and nominal GDP in 2002 were $10,469.6 billion, calculate the percentage change from 2001 to 2002 in nominal GDP, real GDP, and the price level. What is the value of the GDP deflator in 2002?   

C11-AQ3. From the Bureau of Economic analysis Web page (www.bea.gov), construct a table showing the annual percentage change in real GDP, gross private domestic investment (I), nonresidential fixed investment, and residential fixed investment from 2000 to 2008. Discuss how the changes in these variables show the differences between the recession of 2001 and the recession in 2007 and 2008 that is discussed in the news article that opened this chapter.

C12-TQ3. Explain how aggregate expenditure function shifts in response to changes in each of the following variables:

A) The real interest rate increases.

b) Consumer confidence decreases.

C) Higher taxes and imposed on business profits

D) The economics of many countries in the rest of the world go into recessions.

C12-AQ5. What were the key provisions of the economic stimulus bill passed by congress in February 2008? What further changes in fiscal policy have occurred since this time?