unit 2 Flashcards
(117 cards)
Gross Domestic Product (GDP)
the market value of all the final goods and services produced within a country in a given time period (one year)
market value
prices in which items are traded in markets (value= market price x quantity)
market prices
the price of each item
final good or service
a good or service that is produced for its final user and not as a component of another good service
intermediate good or service
a good or service that is used as a component of a final good or service
the same good can be either intermediate or final depending on how it is ____
used
the value of goods and services for their own use is an example of…
exclusions in GDP
market value of homes is equal to…
the rental value
the production of goods and services outside of the the US is an example of…
exclusions in GDP
given time periods of GDP
quarterly GDP (3 months) or annually GDP (12 months)
What GDP does the Federal Reserve use?
quarterly GDP (short term)
What GDP do economists use?
annual GDP (longterm)
four groups that buy the final goods and services
households, firms, governments (local & federal), rest of world
consumption expenditure
household
investments
firms
government expenditures goods and services
governments
net exports and goods
rest of world
nondurable goods + durable goods + rental value + services =?
consumption expenditure
nondurable goods
pizza, oranges, food, anything that can go bad, etc
durable goods
laptop, TV, etc.
services
rock concert, haircut, Xbox subscription, etc.
the purchase of new capital goods and additions in inventory
investment (included in GDP)
the purchase of stocks and bonds are…
NOT equal to stocks and bonds
federal (US Defense Department) + state (State Department) +local (Town Hall) =
government expenditures goods and services