Author Question: Billy is a plumber. He earns 15 per hour. One morning, just before he was leaving for work, he found ... (Read 90 times)

fnuegbu

  • Hero Member
  • *****
  • Posts: 539
Billy is a plumber. He earns 15 per hour. One morning, just before he was leaving for work, he found a pipe in his kitchen leaking. He spent two hours repairing the pipe.
 
  i) How will this affect the calculation of GDP?
  ii) If Billy had spent two hours working for one of his clients, what would have been the effect of his activity on the calculation of GDP?

Question 2

In a market economy, what encourages firms to develop new products and production processes?
 
  A) contracts B) insurance C) patents D) accounting rules


gasdhashg

  • Sr. Member
  • ****
  • Posts: 335
Answer to Question 1

i) If Billy spends two hours repairing a pipe in his kitchen, he does not receive any monetary payment and his activity does not affect the calculation of GDP. This is because home production is not included in the calculation of GDP.
ii) If Billy had spent two hours working for his clients, GDP would have increased by 15  2 = 30.

Answer to Question 2

C



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

The term bacteria was devised in the 19th century by German biologist Ferdinand Cohn. He based it on the Greek word "bakterion" meaning a small rod or staff. Cohn is considered to be the father of modern bacteriology.

Did you know?

Looking at the sun may not only cause headache and distort your vision temporarily, but it can also cause permanent eye damage. Any exposure to sunlight adds to the cumulative effects of ultraviolet (UV) radiation on your eyes. UV exposure has been linked to eye disorders such as macular degeneration, solar retinitis, and corneal dystrophies.

Did you know?

Street names for barbiturates include reds, red devils, yellow jackets, blue heavens, Christmas trees, and rainbows. They are commonly referred to as downers.

Did you know?

Human stomach acid is strong enough to dissolve small pieces of metal such as razor blades or staples.

Did you know?

IgA antibodies protect body surfaces exposed to outside foreign substances. IgG antibodies are found in all body fluids. IgM antibodies are the first type of antibody made in response to an infection. IgE antibody levels are often high in people with allergies. IgD antibodies are found in tissues lining the abdomen and chest.

For a complete list of videos, visit our video library