question
GDP
answer
the total market value of the goods and services produced in a country within a certain time period
- most widely used to measure the size of a nations economy
- most widely used to measure the size of a nations economy
question
GDP Expenditure Approach (Value-of-final-output method)
answer
calculated by summing the amounts spent on goods and serviced produced during the period
question
GDP (Income Approach)
answer
calculated by summing the amounts earned by households and companies during the period, including wage income, interest income, and business profits
question
Sum-of-Value-Added Method
answer
GDP is calculated by summing the additions to value created at each stage of production and distribution
question
Nominal GDP
answer
the total value of all goods and services produced by and economy, valued at current market prices accounted for inflation
question
Real GDP
answer
measures the output of the economy using prices from a base year, removing the effect of the changes in price so that inflation is not counted as economic growth
question
GDP Deflator (+ Formula)
answer
a price index that can be used to convert nominal GDP into real GDP, taking out the effects of changes in the overall price level
= (Nominal GDP in year t/value of year t output at base year prices) x 100
= (Nominal GDP in year t/value of year t output at base year prices) x 100
question
Per Capita Real GDP
answer
often used as a measure of the economic well-being of a country's residents
= Real GDP / Population
= Real GDP / Population
question
Components using Expenditure Approach for GDP
answer
= C + I + G + (X-M)
= Consumption + Imports + Govn't spending + (Exports - Imports)
= Consumption + Imports + Govn't spending + (Exports - Imports)
question
Components using Income Approach for GDP (GDI)
answer
= national income + capital consumption allowance + statistical discrepancy
question
Capital Consumption Allowance
answer
measures the depreciation of physical capital from the production of goods and serviced over a period
- it can be thought of as the amount that would have to be reinvested to maintain the productivity of physical capital from one period to the next
- it can be thought of as the amount that would have to be reinvested to maintain the productivity of physical capital from one period to the next
question
National Income (+ Formula)
answer
the sum of the income received by all factors of production that go into the creation of final output
= compensation of employees + corporate and government enterprise profits before taxes + interest income + unincorporated business net income + rent + indirect business taxes
= compensation of employees + corporate and government enterprise profits before taxes + interest income + unincorporated business net income + rent + indirect business taxes
question
Personal Income
answer
a measure of the pretax income received by households and is one determinant of consumer purchasing power and consumption
question
Household Disposable Income (Personal Disposable Income)
answer
personal income after taxes
question
Total Income Formula
answer
= C + S + T
= consumer spending + household and business savings + Net Taxes
= consumer spending + household and business savings + Net Taxes
question
Fiscale Balance
answer
the difference between government spending and tax receipts
question
Trade Balance
answer
the difference between exports and imports
question
Government Budget Deficit
answer
when G - T is positive
question
Government Budget Surplus
answer
when G - T is negative
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
