Consider a modified version of the Gary Becker-style micro model of fertility choices, in which both men and women have child-care responsibilities. Suppose that the man in the household has Tm hours of time to devote to market work and/or child care, and that he must contribute cm hours per child in care time. His wage in market work is w_m. The woman has Tw hours available for market work and/or child care; she must contribute c_w hours per child in child care. Her wage is w_w. The household has no other sources of income. In addition to parental time, each child requires p in goods such as food and clothing. The household's utility function is U = Na X 1?a , with a being a preference parameter such that 0

Year 2010 Year 2011 Year 2012 Price Quantity Price Quantity Price Quantity Chips $4 100 $4 110 $5 80 Dips $5 50 $4 40 $3 50 Sodas $3 50 $5 60 $5 70 Question 1. GDP [10 Points in Total] a. (3 points) Compute nominal GDP in 2010, 2011, and 2012. [Show your computation work] b. (3 points) Compute real GDP in 2010, 2011, and 2012 (base year method). [Show your computation work] c. (2 points) Compute GDP deflator in 2010, 2011, and 2012. [Show your computation work] d. (2 points) Compute growth rates of nominal GDP and real GDP from 2010 to 2011 and from 2011 to 2012. [Show your computation work] Question 2. Inflation [7 Points in Total] a. (3 points) Compute cost of CPI basket in 2010, 2011, and 2012. [Show your computation work] b. (2 points) Compute CPI in 2010, 2011, and 2012. [Show your computation work] c. (2 point) Compute inflation rates (based on CPI) from 2010 to 2011 and from 2011 to 2012. [Show your computation work] Question 3. Business Cycle [3 Points in Total] a. (2 points) Based on your answers on Question 1 and 2 above, did Aggieland experience an expansion or a recession from 2010 to 2011? How about from 2011 to 2012? Was it at peak or trough or neither in year 2011? b. (1 point) From 2010 to 2011, did Aggieland experience an inflation or deflation? How about from 2011 to 2012?QUESTION 15 which of the following counts as US GDP? 50 Boeing 737 produced in Seattle and sold to Chinese airline Air China 5000 Focus produced by a Ford company in Beijing, China O 10,000 bottles of expensive wine imported from Northern Italy, Brescia, consumed in San Diego 5 million copies of Adele CDs produced in London, and purchased by US Adele fans QUESTION 16 As published by the BEA in September, the Nominal GDP for the second quarter of 2019 is and the real GDP growth rate the second quarter of 2019 is O $ 17.03 trillion, 3% O $ 21.34 trillion, 2.1% C $ 17.03 trillion, 1.2% O $ 19.25 trillion, 1.2%Question 41 1 pts Assume that there are decreasing returns to capital, decreasing returns to labor, and constant returns to scale. Now suppose that both capital and labor decrease by 3%. Then o output will not change. output will decrease by more than 3%. o output will decrease by less than 3%. output will decrease by 3%. Question 42 1 pts In the growth model in chapter 11 without technological progress or population growth, suppose that Kt+1/N