Homework: Due Monday, 9 April, 2007

1) The CIA director should take into account that GDP does not record the "underground economy". The "underground economy" is largely comprised of illegal activities, activities which the CIA likes to keep tabs on. It could be problematic for America's Intelligence Agency if they are not able to see this.

2) Prostitution, gambling, and some types of drug use are part of what has been labelled the "underground economy" in the previous question. It therefore stands to reason that countries that allow these activities take them into account when calculating their GDP, therefore making it seem larger than that of a country that does not allow such activities.

3)

4)
a) Out
b) Out
c) In
d) In
e) Out
f) Out

5)