ECON 104 Homework 2 Answer (Penn State University)

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1. Part 1: 32 questions at 3 points each for a total of 96 points FOR FILL-IN-THE-BLANK questions: If your answer is in decimal form, round to 2 decimal places. For example, if your answer is .412, enter it into the fill-in-the-blank as .41, or if your answer is 1.415, enter it into the fill-in-the-blank as 1.42. If there are no decimals in your answer, you will simply enter the number; so if your answer is 2, enter 2 with no decimals. Do not enter any extra spaces, do not enter commas or $ or % symbols. Use the information below to answer questions 1-6 Consider an economy that produces only two goods: fresh apricots and dried apricots. In this economy, the technology of producing dried apricots is to place fresh apricots on special racks and allow them to dry in the sun. Fannie’s Farms is the only company that grows fresh apricots, while Darryl’s Dried Victuals is the only producer of dried apricots. Fannie’s sells some of its apricots directly to consumers for consumption. The relevant revenue and cost information for each of the two firms in the economy is given below: Darryl's Dried Victuals Revenue from selling dried apricots: $2,300,00 0 Cost of buying fresh apricots from Fannie’s: 1,200,000 Interest on funds borrowed to buy drying racks: 250,000 Wages paid to employees 600,000 Taxes 100,000 Fannie’s Farms Revenue from selling fresh apricots: $2,000,000 Rent on land (including apricot trees) 300,000 Wages to employees 1,200,000 Taxes 200,000 Darryl's profit from selling dried apricots is: A) $100,000 B) $150,000 C) $300,000 D) $310,000 E) none of the above are correct Feedback: 2,300,000-1,200,000-250,000-600,000-100,000 = 150,000 Points Earned: 3.0/3. 0 Correct Answer(s): B 2. Fannie’s profit from selling fresh apricots is: A) $100,000 B) $150,000 C) $300,000 D) $310,000 E) none of the above are correct Feedback: 2,000,000-300,000-1,200,000-200,000= 300,000 Points Earned: 3.0/3. 0 Correct C Answer(s): 3. Use the income approach to calculate nominal GDP. Fill in the blanks in the table below. Enter numbers with no commas, no dollar signs and no decimals. For example, if your answer is $12,000 you would enter 12000 into the appropriate box. a. Total wages b. Interest c. Rent d.Total profit* e. Total taxes Nominal GDP =(a+b+c+d+e) *hint: get total profit by adding your answers for #1 and #2! Points Earned: 3.0/3.0 Correct Answer(s): Box 1: 1800000; Box 2: 250000; Box 3: 300000; Box 4:

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ECON 104 Homework 1-7 Answers Graded A (Penn State University)

Awarded 88.00 Points Missed 12.00 Percentage 88.0 % 1. Part 1: 32 questions at 3 points each for a total of 96 points FOR FILL-IN-THE-BLANK questions: If your answer is in decimal form, round to...

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