CSUN Early Macroeconomics Estimating how Much Buying Power Case
Description
You work for a corporation that is looking to sell its product in other countries. Your boss suggests that they use GDP/capita as a way of estimating how much buying power people will have in a particular country. She asks you to list five reasons why this may not be a good measurement (and explain why for each reason). What do you write?
Which of the following are counted in GDP (and why)? Which are not counted (and why)?
You buy a hamburger at fast food outlet
A friend cuts your hair
You receive a scholarship
McDonalds buys a new fryer machine
Glendale College builds a new parking lot
You buy a plane ticket to Oakland
You receive social security
Your employer pays you off the books
You buy the textbook for the course
Repairs made to Interstate freeway 10
4. The most recent US government report on GDP is at: https://www.bea.gov/index.php/news/2022/gross-dome…
Your boss has looked at the report and is confused: “There is so much here and I don’t know the economics.” She asks you to write a one paragraph summary letting her know the good news and the bad news. She asks that you not quote from the report but based on your knowledge of macroeconomics. put your summary in language that she will understand easily.
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