Flashcards in Macroeconomic Work Sheet 1 Deck (4)
Loading flashcards...
1
Q
GDP
A
The value of aggregate output produced within an economy in a 12 month period.
2
Q
Nominal GDP
A
The sum of the quantities of final goods produced in an economy times their current price. ( GDP measures at current prices).
3
Q
Real GDP
A
A measure of aggregate output. The sum of quantities produced in an economy times their price in a base year. Also known as GDP adjusted for inflation.
GDP after allowing for inflation: i.e. GDP measured in constant prices: i.e. in terms of the prices ruling in some base year.
4
Q
What does the GDP deflator measure?
A
The ratio of nominal GDP to real GDP; a measure of the overall price level. Gives the average price of the final goods produced in an economy.