AB 204 Course Great Wisdom / tutorialrank.com AB 204 Course Great Wisdom / tutorialrank.com | Page 6

1) U.S. real GDP is substantially higher today than it was 60 years
ago. What does this tell us, and what does it not tell us, about the
well-being of U.S. residents? What are the limitations of the GDP as a
measure of economic well-being? Given the limitations, why is GDP
usually regarded as the best single measure of a society’s economic
well-being?

2) What is an intermediate good? How does an intermediate good
differ from a final good? Explain why it is the case that the value of
intermediate goods produced and sold during the year is not included
directly as part of GDP, but the value of intermediate goods produced
and not sold is included directly as part of GDP.

3) GDP is defined as the market value of all final goods and services
produced within a country in a given period of time. In spite of this
definition, some production is left out of GDP. Explain why some
final goods and services are not included.

4) The table below contains data for country A for the year 2010.
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AB 204 Unit 5 Assignment
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1) Assume there is a simple economy where people consume
only 2 goods, food and clothing. Further assume that the market