Economics HW Help.... really really easy macro economics

[gopunk]

i just have to say whether these can be negative or not...

nominal interest rate (yes?)
trade balance (yes)
real interest rates (yes)
price level (no)
nominal growth rate (yes)
gdp deflator (yes)
net fdi (yes?)
productivity (no?)
real growth rate (yes)

i'm torn on three of them (?)...

should i put yes for nominal interest rate? i mean it is possible right? just not very common...

and for net fdi... i've seen it as a negative before, but if it was negative, would it really be considered an "investment" then?

and what about productivity? what if they consume goods without producing them? is that negative productivity or is that just consumption and productivity is zero?

thanks!

 

[luckydragon]

hey gopunk what macro class are you taking?

 

[gopunk]

201... i think it's section b

 

[luckydragon]

i'm in macro 201 too lecture at 8:30 in kane hall right? are you doing the wsj homework?

 

[HamSupLo]

I guess a negative nominal rate is possible if someone essentially pays you to take out a loan or penalizes you for leaving money in a bank account. I think I've heard of that happening in Japan when deflation was getting out of hand.

 

[BigToque]

hey gopunk, I've got a macroeconomics assignment due tomorrow. can i crap your thread with my own questions as I get to them?

 

[gopunk]

<< i'm in macro 201 too lecture at 8:30 in kane hall right? are you doing the wsj homework? >>



nah, my section is taught by ta only... it's separate from a (the big one)

stefan - yes

 

[BigToque]

question 2

'90 Nominal GDP - 172,724
'90 Real GDP - 131,503
'91 Nominal GDP - 207,517
'91 Real GDP - 142,591

What we're the growth rates of nominal and real GDP between '90 and '91? (I thought this was just the difference in value)
Which is bigger? (Nominal)
What explains the difference? (it has to do with increasing quantity and a fixed price. I don't know how to answer though)

 

[gopunk]

i'm pretty sure you calculate growth rate by taking 91's gdp and dividing it by 90's gdp, and then substracting from 1

difference probably has something to do with inflation, since that's the only difference between nominal and real... right?

 

[BigToque]

<< difference probably has something to do with inflation, since that's the only difference between nominal and real... right? >>



Well, this was my answer to the question was (but not on paper) "Real GDP is calculated by using a fixed price from some base year. As time goes by, an increace in product cost due to inflation isn't taken into consideration."

Right? Wrong?

 

[gopunk]

yea looks good to me. i would maybe put in info about nominal, to compare and contrast the two... and also reword "isn't taken into consideration."... because right now it sounds like it's a bad thing that it isn't affected by inflation...

 

[gopunk]

bump...

 

[BigToque]

Next question:

Tokyo is a very expensive place to live. They must have a high inflation rate in Japan.

(most questions are worth 10 marks but have multiple parts to them. This question is worth 5 marks so its not too important to expand on it in too great detail)

 

[gopunk]

er.... where's the question?

 

[BigToque]

sorry

Critically evaluate: "Tokyo is a very expensive place to live. They must have a high inflation rate in Japan."

 

[gopunk]

eh, false if you ask me... quality of goods might be higher, taxes, etc.

 

[freebee]

edit- my answer wasn't right.

I jsut graduated from NYU with an econ degree...shows how little i know.

 

[BigToque]

quick question...

g) a gardener gets income for his services

q: Would this expenditure be included in the computation of GDP? (I say yes, but I'm not sure cause i don't know if the gardener works for a company or just a friend of the person he's doing the work for)

What is the determining factor of whether somthing is included in the computation of GDP? I thought it was some sale or service that could be reported (but reported to who?)