GDP Flashcards
(10 cards)
What is GDP?
a measure of the value of all the goods and services newly produced in a country during some period of time.
What are the factors which make up GDP?
Consumption (C), Investments (I), Government Purchases (G), Net Exports (X)
What is the Spending approach to calculating GDP
Y(GDP)= C + I + G + X
What is real GDP?
a measure of production that corrects for inflation.
To calculate the real GDP of 2012 in reference to 2008 we must __________.
use the same prices for both years.
What is the nominal GDP?
GDP without any correction for inflation
What is a GDP deflator ? How do you calculate it ?
a measurement of the level of prices of Good and Services included in real GDP relative to a given base year.
GDP deflator = Nominal GDP / real GDP
how does knowing the GDP deflator help us find the Real GDP
Real GDP = nominal GDP / GDP deflator
the percentage change in GDP from one year to another is a measure of the ___________?
rate of inflation.
what is CPI
Consumer Price Index, a price index equal to the current price of a fixed market basket of consumer goods and services relative to a base year.
