Economy's income and expenditure
Measurement Of Gross Domestic Product
Components of GDP
Real Versus Nominal GDP
Miscellaneous
100
What does GDP stand for?
Gross Domestic Product
100
What is the market value of all final goods and services produced within a country in a given period of time?
GDP
100

The letter that represents GDP in the GDP equations

What is Y?

100
What is the production of goods and services valued at current prices?
Nomial GDP
100

GDP per person tells us the income and expenditure of the ________ person in the economy

What is average?

200

Two things that GDP measures?

What are total expenditures(spending) and total income?

200

What does GDP exclude from measuring because it is so difficult?

Items produced and sold illicitly (illegal drugs), items produced and consumed at home that never enter the marketplace

200
Is buying a house an investment or consumption?
The purchase of a new house is considered an investment. Hopefully, the money you spend on the house will in turn generate you more money when you sell, rent out, or use the house for your financial gain.
200
What is the production of goods and services valued at constant prices?
Real GDP
200

An economic diagram that shows how money, goods, services, and factors of production continuously move between different sectors of an economy.

What is the circular flow model?

300
GDP measures the flow of ________.
Money
300
Give an example of a tangible good and intangible service that GDP includes
food, clothing, cars; haircuts, housecleaning, doctor visits
300

What are government purchases? Give an example. 

Spending on goods and services by local, state, and federal governments; salaries of government workers and spending on public works

300
What is a better measure of economic well being? Why?
Real GDP is a better measure of economic well being because it is corrected for inflation
300

Difference between durable and nondurable goods 

Durable goods last a relatively long time. Nondurable goods last for a short period of time.

400
The amount of parts every transaction has

What is every transaction has two parts to it

400

What is the difference between intermediate goods and final goods?

Intermediate goods are goods that go into the production of final goods An example of such would be the wool (intermediate good) that goes into the production of the final good (sweater)

400

What are Net Exports? Give an example that would increase net exports.

Net exports are spending on domestically produced goods by foreigners (exports) minus spending on foreign goods by domestic residents (imports). A domestic firm's sale to a buyer in another country, such as the Boeing sale to British Airways, increases net exports.

400
What is the goal in computing GDP?
GDP is used to measure how well the overall economy is performing. Because GDP measures the economy's production of goods and services, it reflects the economy's ability to satisfy people's needs and desires.
400

Act of buyers and sellers freely and willingly engaging in market transactions

What is voluntary exchange?

500

The four components of GDP?

What are Consumption, Investment, Government Spending, and Net Exports?

500

What contributes more to GDP- the production of a pound of hamburger or the production of a pound of caviar? Why?

A pound of caviar contributes more to GDP because it costs more than a pound of hamburger. The contribution to GDP is measured by market value and the price of a pound of caviar is much higher than the price of a pound of hamburger.

500
What is the equation for finding GDP?
Y = C + I + G + NX
500
What is GDP deflator and how is it calculated?
A measure of the price level calculated as the ratio of nomial GDP to real GDP times 100; reflects the prices of goods and services but not the quantities produced
500

The parts of every transaction are a ___________ and a _____________.

What are a buyer and a seller? If someone spends a dollar, that dollar is an income for someone else.

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