GDP

Question 1

value

Answer 1

prices x quantity

Question 2

market value

Answer 2

data they get from the market place produced (not sold)

Question 3

country

Answer 3

in its boarders

Question 4

what’s included in GDP

Answer 4

-anything produced in a country
-if something is built in the united states but the owner isn’t based in the united states it is included in GDP

Question 5

what’s not included in GDP

Answer 5

-illegal transactions (drug dealing, black market dealing)

-stock and bond purchases

-transfer payments → payments made to us by the government

-used good sales → bc already counted when first bought

-if something is sold in the united states but its not produced in the united states its not included in GDP

Question 6

gross national product (GNP)

Answer 6

if something is being sold in the united states but is not produced in the united states it is included in GNP

Question 7

how is GDP calculated

Answer 7

Y=C+I+G+NX

Question 8

Y

Answer 8

is the income; money received for selling something

Question 9

C

Answer 9

is consumption (consumer spending) -> total spending by all households on goods or services; one exception not included in C section is housing

• durable goods → things we don’t buy all the time; are all the way down
• non-durable goods → things we buy all the time

Question 10

I

Answer 10

is investment -> the total spending on goods and serves by firms or businesses; housing is included in I section

Question 11

G

Answer 11

is government (federal) spending -> the total spending on goods and services by the government

Question 12

NX

Answer 12

NX is Ex - Im

Question 13

Ex

Answer 13

is exports → the total amounts of goods and services produced in US sold to world

Question 14

Im

Answer 14

is imports → the total amount of goods and services produced in the world sold to US

Question 15

nominal GDP

Answer 15

calculating GDP using current (or that year) prices

Question 16

the real GDP

Answer 16

calculates GDP using a base year or constant prices; have to some how isolate prices (keep it stable)

Question 17

percentage change in GDP

Answer 17

newest value - oldest value / oldest value x 100 = %change

Question 18

economic reception

Answer 18

3 times in a row of negative GDP

Question 19

economic expansion

Answer 19

positive GDP

Question 20

GDP deflator

Answer 20

a measure or statistic of calculating inflation or deflation from price changes

Question 21

GDP deflator for year x

Answer 21

(nominal GDP / real GDP) x 100

Question 22

the percentage change in GDP deflator

Answer 22

(newest GDP deflator - oldest GDP deflator / oldest GDP deflator) x 100

-inflation or deflation is indicated with this

Question 23

GDP per capita

Answer 23

GDP/population

-per person how much someone produces in this country

Question 24

GDP production function

Answer 24

GDP = a(technology)f( L-labor, N-natural resources, K-capital, H-technological knowledge)

Question 25

diminishing marginal return

Answer 25

examples that smaller country goes further than bigger countries for the same increase in a unit of productivity

Question 26

nominal interest rate

Answer 26

is a value of interest of rate based on the current value of the market

Question 27

real interest rate

Answer 27

nominal interest rate - inflation
r = n - π