Economic growth is a very important topic. to the extent that gdp measures the well-being of people in an economy, increases in gdp should translate into increases in standard of living.

a. what measure of gdp is most closely related to the economic well-being of the people in an economy?

b. if y = c + i + g + (x - m), is it necessarily true that decreased consumption and increased saving by households will result in lower gdp in the short run?

c. the production possibilities frontier shows output combinations at which an economy can produce given its current resources. on a ppf graph, show the long-term effect of increased household saving, and explain the effect in words.

d. on a production possibilities frontier, the two goods may be classified as "consumption" and "investment" goods. how will the shift in the ppf from this year to, say, five years from now differ if we choose a point with high consumption as opposed to choosing a point with high investment? or a point with high investment goods? explain in words and with graphs.

Cindy recently played in a softball game in which she misplayed a ground ball for an error. later, in the same game, she made a great catch on a very difficult play. according to the self-serving bias, she would attribute her error to and her good catch to her

Shrieves casting company is considering adding a new line to its product mix, and the capital budgeting analysis is being conducted by sidney johnson, a recently graduated mba. the production line would be set up in unused space in the main plant. the machinery’s invoice price would be approximately $200,000, another $10,000 in shipping charges would be required, and it would cost an additional $30,000 to install the equipment. the machinery has an economic life of 4 years, and shrieves has obtained a special tax ruling that places the equipment in the macrs 3-year class. the machinery is expected to have a salvage value of $25,000 after 4 years of use. the new line would generate incremental sales of 1,250 units per year for 4 years at an incremental cost of $100 per unit in the first year, excluding depreciation. each unit can be sold for $200 in the first year. the sales price and cost are both expected to increase by 3% per year due to inflation. further, to handle the new line, the firm’s net working capital would have to increase by an amount equal to 12% of sales revenues. the firm’s tax rate is 40%, and its overall weighted average cost of capital, which is the risk-adjusted cost of capital for an average project (r), is 10%. define “incremental cash flow.” (1) should you subtract interest expense or dividends when calculating project cash flow?

Tom has brought $150,000 from his pension to a new job where his employer will match 401(k) contributions dollar for dollar. each year he contributes $3,000. after seven years, how much money would tom have in his 401(k)?