CHapter 2

Question 1

periods of steady growth in output along with an improvement in living standards

Answer 1

economic growth

Question 2

measured by gdp or real gdp

Answer 2

economic growth

Question 3

T or F
It is an economic growth if it fluctuates

Answer 3

F, must be continuous

Question 4

T or F
there is no econ development, if there is no econ growth

Answer 4

T

Question 5

market value of all final goods and services produce within a nation in a given time

Answer 5

gross domestic product

Question 6

measurement of output based on current price

Answer 6

Nominal GDP

Question 7

measurement of output based on changes in inflation

Answer 7

Real GDP

Question 9

T or F
even foreign companies INSIDE the country included in the computation of gdp

Answer 9

T

Question 10

difference between nominal and real gdp

Answer 10

GDP deflator

Question 11

GDP is based from the spending by household, businesses, and the government in a given period

Answer 11

Expenditure Approach

Question 12

GDP is based from the earnings by househods, businesses, and the government in a given period

Answer 12

Income Approach

Question 13

GDP is the sum of the amount of final goods adn services produced and multiplied by the respective prices in a given period

Answer 13

Flow of Product Approach

Question 14

GDP is the sum of the output of the major industries of the economy for a given period

Answer 14

Gross Value Added Approach

Question 15

3 MAjor Sectors in the PH

Answer 15

Agriculture
services
industry - highest percentage

Question 16

Notes on GDP calculations

Answer 16

a. only final goods
b. secondary sales not included
c. only final goods for the priod

Question 17

GDP is computed

Answer 17

quarterly

Question 18

Limitations of GDP

Answer 18

a. not include non market activities that could be considered part of economic activity
b. not include informal sector (illegal or unregistered business)
c. not include externalities (eg. natural calamities)

Question 19

market value of all final goods and services produced by nationals of a country for a given period

Answer 19

gross national product

Question 20

total income received by most basic factors of production in a country

Answer 20

NAtional Income

Question 21

Differntiated gdp and gnp

Answer 21

gdp- all inside the country even foreign companies
gnp- all citizens of a country even not currently in the country but exclude foreign

Question 22

factors of production

Answer 22

labor - salaries/wages
land - rent
capital - interest
entrepreneur - profit

Question 23

income received bt an individual net of taxes

Answer 23

Disposable Income
(take-home pay)

Question 24

summary measure of average development in key dimensions of human development

Answer 24

human development index

Question 26

geometric mean of normalized indices for each of the three dimensions

Answer 26

human development index

Question 27

key dimensions of human development index

Answer 27

long and healthy life being knowledgeable decent standard of living

Question 28

states that at a point in time, happiness varies directly with income both among and within nations, but ovetime happiness does not trend upward as income continuous to grow

Answer 28

Easterlin paradox