1. Why is per capita GDP so much higher in the United States than in Mexico? 2.
ID: 1132624 • Letter: 1
Question
1. Why is per capita GDP so much higher in the United States than in Mexico? 2. Do we need more or less government intervention to decide WHAT, HOW and FOR WHOM? Give specific examples. 3. According to the News Wire "Manufacturing: Fewer Jobs, More Output, since 1975 in the manufacturing sector a. has output increased or decreased? b. has employment increased or decreased? c. has productivity increased or decreased? 4. Complete the table and answer the Before-Tax Income Tax Rate 39.6% 20.0% 10.0% Income Level Tax Paid After-Tax Income High Income F Middle Income F Low Income F $500,000 50,000 20,000 What is the ratio of a high-income family's income to a low-income family's income a. before taxes b. after taxes c. Is this tax progressive? S. Suppose the g data describe output in two different years Item Year 1 Year 2 20,000 25g each 700$800 each 10,000 @ $1.00 each 30,000 @ 30¢ each 650 e $900 each 12,000 e $1.50 each les Movie Rentals Page 1 of 2 Econ 1333 Problem Set 2 a. Compute nominal GDP in each year b. By what percentage did nominal GDP increase between Year 1 and Year 2? c. Now compute the real GDP in Year 2 buy using the prices of Year 1 d. By what percentage did real GDP increase between Year 1 and Year 2. e. What does comparing the two percentages (b and d) tell us? 6. Why do income inequalities diminish as an economy develops? 7. Why do we measure output in value terms rather than physical terms? For that matter, why do we bother to measure output at alli?Explanation / Answer
1) The per capita GDP is calculated as follows- GDP/Population.
The United states is endowed with inputs and resources such as capital,technology and human labor skills and knowledge.The abundance of resources makes the production in US much more productive than in Mexico and also the national output of US is much higher.
The amount of output is dependant on a country's resources and technology so with increase in these resources,the US has more productive process and people than Mexico which is basically poor in these resources which makes it less productive and thus the national output is much lower even though it is more populated than US.This creates the difference in the per capita GDP between the two countries.
2) The level of government intervention is determined by the type of goods and services being introduced and distributed to the society.
The goods and services such as consumer durable goods,electronics are provided well by the private companies are not regulated whereas, the goods where private companies cannot provide equitable allocation of resources to everyone, such as public goods like transportation needs governement intervention so as to prevent monopoly and maintain low cost overall.
Note- As per chegg policy,only the first full question should be answered.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.