ECON BC 3033x Lecture Notes - Lecture 2: Autarky, Black Market
14 Sep 2016
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Document Summary
Land, labor, and capital (llc) are raw materials and building blocks of the economy. Increase in llc increase in output higher level of economic growth. Fourth building block of economy entrepreneurship (ability to innovate) In circular flow model, what"s exogenous to model govt/taxes, prices, elasticity, shock (war, famines), international trade. Demand + supply are apart of the product and resource markets. Stock=quantity measured at a given point in time. Flow= quantity measured per unit of time. Income (flow) wealth (stock) consumption. Measure of how much a country produces in one year. Total debt accumulated since beginning of time (stock) Three formulas: gdp, cpi/ inflation, lfpr/ unemployment. Gross domestic product (gdp) measure of total output. Most common way to calculate gdp expenditure approach. I investment (15%), new capital, depreciation decreases outflow of capital. Nx net exports, exports-imports, (-5%)- this is because imports > exports. Doesn"t measure leisure time, underground economy, etc.
