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Macro Topic 2.2 Limitations of GDP

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106 views

Macro Topic 2.2 Limitations of GDP

Uploaded by

ruzgar.ozcengiz
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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AP© MACROECONOMICS TOPIC 2.

2
Limitations of GDP
Part 1: Check Your Understanding- Put a check mark (✓) in the box if the expenditure is counted in the United States
GDP. If it is counted, indicate the correct category. If it is not counted, indicate why it is not counted.

☐ 1. You volunteer for 50 hours this month at a local soup kitchen

☐ 2. Katie sells home grown tomatoes at the local farmers market

☐ 3. Sarah bakes an apple pie from apples grown in her backyard

☐ 4. An accountant does her own taxes

☐ 5. A Social Security check from the government to a retired steelworker

☐ 6. The federal government purchases $1 billion worth of smart bombs

☐ 7. Teddy pays a divorce attorney for his services

☐ 8. A grandmother spends 8 hours a day caring for her grandchildren

☐ 9. Becky buys Taylor Swift tickets from a guy in the arena parking lot

☐ 10. An insurance company pays $30,000 for a patient’s chemotherapy

☐ 11. College students buy used textbooks for their courses

☐ 12. A hairdresser pays an accountant $200 to complete her tax returns


Part 2: Primary Source Analysis- Listen to Robert F. Kennedy’s 1968 GDP speech and complete the following.
13. According to the speech, what is the limitation of using GDP to measure the true standard of living in a country?

14. Identify three goods mentioned in the video that are counted in GDP but, in reality, might reduce standard of living.

Part 3: Analyzing Data- Use the data showing the annual GDP growth for the US to complete the following.
15. What three-year period of time had the highest GDP growth rates? Why did this occur?

16. Describe a time when the GDP data provided a misleading view regarding the actual living conditions for individuals
or groups in the US.

17. Would you prefer to live in the 1930s, 1940s, 1950s, 1960s, 1970s, 1980s or the 1990s? How is your decision
influenced by factors that are not counted in GDP.

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