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Economics and Personal finance > Unit 3 Part 4 Quiz > Flashcards

Unit 3 Part 4 Quiz Flashcards

1
Q

WHY DO WE MEASURE GROWTH?

A

BECAUSE OF THE GREAT DEPRESSION. ECONOMISTS FELT IT WAS IMPORTANT TO MEASURE TO PREDICT AND PREVENT FUTURE ECONOMIC DOWNTURNS

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2
Q

NIPA

A

NATIONAL INCOME AND PRODUCT ACCOUNTS

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3
Q

WHAT DOES NIPA DO?

A

COLELCTS DATA ON PRODUCTION, INCOME, INVESTMENT, AND SAVINGS

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4
Q

WHO IS NIPA MAINTAINED BY?

A

THE DEPARTMENT OF COMMERCE

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5
Q

WHAT IS NIPA DATA USED FOR?

A

THE DATA IS REPORTED AND USED TO INFLUENCE GOVERNMENT POLICY

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6
Q

GDP OR GROSS DOMESTIC PRODUCT

A

THE DOLLAR VALUE OF ALL FINAL GOODS AND SERVICES PRODUCES WITHIN A COUNTRY’S BORDERS IN A GIVEN YEAR

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7
Q

WHAT IS A FINAL GOOD?

A

FINAL GOODS ARE THOSE SOLD TO CUSTOMERS

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8
Q

WHAT WAS THE GDP OF U.S IN 2020?

A

21.43 TRILL

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9
Q

PER CAPITA GDP

A

GDP DIVIDED BY A COUNTRY’S POPULATION

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10
Q

WHAT DOES PER CAPITA GDP DO?

A

MEASURES THE AVERAGE INCOME PER PERSON IN A COUNTRY

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11
Q

EX: OF PER CAPITA GDP

A

If a country’s GDP is $10 trillion and it has 250 million people, the per capita GDP is
$40,000

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12
Q

INTERMEDIATE PRODUCTS

A

GOODS USED TO MAKE OTHER PRODUCTS ARE NOT COUNTED

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13
Q

SECONDHAND SALES

A

TRANSACTIONS INVOLVING USED GOODS ARE EXCLUDED

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14
Q

NON- MARKET TRANSACTIONS

A

ACTIVITIES LIKE HOUSEHOLD CHORES OR VOLUNTEER WORK ARE NOT PART OF GDP

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15
Q

UNDERGROUND ECONOMY

A

ILLEGAL OR UNREPORTED ACTIVITIES ARE NOT INCLUDED

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16
Q

WHAT DOES GDP MEASURE WITHIN?

A

A NATIONS BORDERS!!

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17
Q

GDP DOES NOT INCLUDE:

A

PRODUCTS MADE BY A US COMPANY OVERSEAS.
- A CAR MADE IN THE US BY TOYOTA (JAPANESE COMPANY)

18
Q

NOMINAL GDP

A

GDP MEASURES IN CURRENT PRICES
- DOES NOT ALWAYS MEASURE AN INCREASE IN OUTPUT

19
Q

REAL GDP

A

REAL GDP IS MEASURED BY CALCULATING GDP WITH CONSTANT PRICE

20
Q

NONMARKET ACTIVITIES

A

GDP DOES NOT MEASURE GOODS AND SERVICES THAT PEOPLE MAKE OR DO THEMSELVES, SUCH AS CARING FOR CHILDREN, MOWING LAWNS, OR COOKING DINNER

21
Q

THE UNDERGROUND ECONOMY

A

THERE IS MUCH ECONOMIC ACTIVITY WHICH, ALTHOUGH INCOME IS GENERATED, NEVER REPORTED TO THE GOVERNMENT, EX: BLACK MARKET TRANSACTIONS, AND UNDER THE TABLE WAGES

22
Q

NEGATIVE EXTERNALITIES

A

UNINTENDED ECONOMIC SIDE EFFECTS, SUCH AS POLLUTION,HAVE A MONETARY VALUE THAT IS OFTEN NOT REFLECTED IN GDP

23
Q

QUALITY OF LIFE

A

ALTHOUGH GDP IS OFTEN USED AS A QUALITY OF LIFE MEASUREMENT, THERE ARE FACTORS NOT COVERED BY IT. THESE INCLUDE LEISURE TIME, PLEASANT SURROUNDINGS, AND PERSONAL SAFETY

24
Q

INFLUENCES ON GDP

A
  • AGGREGATE SUPPLY
  • AGGREGATE DEMAND
25
Q

AGGREGATE SUPPLY

A

THE TOTAL AMOUNT OF GOODS AND SERVICES AVAILABLE IN AN ECONOMY AT ALL PRICE LEVELS

26
Q

AGGREGATE DEMAND

A

THE TOTAL AMOUNT OF GOODS AND SERVICES DEMANDED IN AN ECONOMY AT ALL PRICE LEVELS

27
Q

IS IT ACCURATE?

A
  • MANY THINGS TO CALCULATE IN GDP AND MUCH IS MISSED OR OVERLOOKED
  • IT DOES PROVIDE A BASELINE
  • MEASUREMENT NOT ACCURATE BUT CONSTANT
28
Q

GNP OR GROSS NATIONAL PRODUCT

A

GNP measures the total income earned by a country’s residents, regardless of where they are
located

29
Q

SUB CATEGORIES OF GDP

A
  • NET NATIONAL PRODUCT
    -NATIONAL INCOME
  • PERSONAL INCOME
  • DISPOSABLE PERSONAL INCOME
30
Q

NET NATIONAL PRODUCT (NNP)

A

deducts depreciation (wear and tear on assets) from GNP

31
Q

NATIONAL INCOME (NI)

A

the total income earned by individuals and businesses in a country

32
Q

PERSONAL INCOME

A

income received by individuals, including transfer payments.

33
Q

DISPOSABLE PERSONAL INCOME

A

PI minus taxes, representing the income people have
available for spending.

34
Q

ECONOMIC SECTOR

A

a big group or category that groups together
businesses and activities based on what they do. It helps us understand how different parts
of the economy work

35
Q

EXAMPLES OF ECONOMIC SECTORS

A
  • CONSUMER SECTOR
  • INVESTMENT SECTOR
  • GOVERNMENT SECTOR
  • FOREIGN SECTOR
36
Q

CONSUMER SECTOR

A

Higher GDP and income mean more money for consumers
to spend, boosting demand for goods and services.

37
Q

INVESTMENT SECTOR

A

Businesses use GDP data to plan investments. High GDP can signal
growth opportunities

38
Q

GOVERNMENT SECTOR

A

Government uses GDP for economic planning, taxation, and budgeting

39
Q

FOREIGN SECTOR

A

High GDP can attract foreign investments and influence exchange rates.

40
Q

GNP

A

“THE FLIP SIDE OF THE COIN OF GDP”

Economics and Personal finance (10 decks)

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