ECON 1100 Chapter Notes - Chapter 4: Old Age Security, Fixed Capital, Operating Surplus

51 views5 pages

apricotmoose352

3 Dec 2017

School

Department

Course

Professor

For unlimited access to Textbook Notes, a Class+ subscription is required.

Document Summary

Chapter 4 - measuring total production & income. Microeconomics - the study of how households and firms make choices, how they interact in markets, and how the government attempts to influence their choices. Macroeconomics - the study of the economy as a whole, including topics such as inflations, unemployment, and economic growth. Business cycle - alternating periods of economic expansion and economic recession (macroeconomic issue). Expansion - period in which production and total employment are increasing. Recession- period in which production and total employment are decreasing. Economic growth - the ability of an economy to produce increasing quantities of goods and services (macroeconomic issue). Inflation rate - the percentage increase in the price level from one year to the next (macroeconomic issue). Gdp - the market value of all final goods and services produced in a geographic area (country) during a period of time, typically one year. Includes only the market value of final goods and services.

Related Questions

 9. The series of ups and downs that tend to move the economy is known as __________. a. The economic cycle (business) b. recession c. depression d. economic growth 11. In the Circular Flow Model, consumption expenditures are the expenses of __________. a. The signatures by the factors of production. b. The government in the financial markets. c. The rest of the world in the goods market d. Families in the goods market. 12. GDP is a measure of the total value of __________. a. Sales in an economy over a period of time b. The consumer's income in an economy over a period of time. c. The accumulation of capital in an economy over a period of time. d. The final goods and services produced in an economy over a period of time.

 13. In calculating GDP, double counting (counting the same twice) is avoided, not including __________. a.. Net exports b. Intermediate goods c. Illegal activities d. The depreciation

An improvement in technology causes the production possibilities frontier (PPF) to

	shift to the right.
	pivot upward.
	shift to the left.
	pivot downward.

(7)

Which of the following is not shown by the circular flow model?

	The flow of resources in one direction and money in the other
	The equality of aggregate spending and aggregate income
	The interaction of households, firms, and the government
	The total amount of goods and services the economy can produce

(8)

Gross domestic product (GDP) is defined as

	the market value of all final goods and services produced in an economy in a given period of time.
	the market value of all consumption goods and services produced in an economy in a given period of time.
	the market value of all investment goods and services produced in an economy in a given period of time.
	the real value of all investment goods and services produced in an economy in a given period of time.

(9)

Real GDP

	includes all domestic and foreign transactions.
	includes the dollar value of domestic transactions only.
	tries to isolate the effect of changing output, holding prices constant.
	measures GDP in terms of prices of goods and services produced.

(10)

When economists talk about economic growth, they are usually referring to

	the percentage change in nominal GDP.
	the percentage change in real GDP.
	the percentage change in nominal investment.
	the percentage change in real investment.

chocolateant769

What is the market for factors of production?

What is the market for factors of production?
1. The market for factors of production is where households and firms interact to trade factors of production for factor payments. For example this is where people provide firms with labor and firms pay them with wages.
What is the money market?
1. The money market is where households, firms, and the government may save and/or invest their money to earn interests. Money market includes banks, stock market, bonds market, and other financial institutions where economic actors can buy and sell financial assets to earn interests and/or dividends.
Who are the three economic actors in the circular flow model?
1. In a circular flow model, the three main economic actors are the households, firms, and the government. Households include the typical individual consumers. Firms include businesses and similar producers in the economy. Finally, the government refers to the whole government system from federal to local level.
How is the national income of an economy determined?
1. The national income of an economy is determined by measuring the total value of the output produced in an economy or the total income earned by the actors in the economy. In a circular flow model, we can see that the value of total output produced should equal the total value of income generated and earned in the economy. This is because every dollar spent by someone in the economy is received by another person in the economy as income.
What is GDP?
1. The gross domestic product or GDP represents the sum total of the value of the final goods and services produced within the economy for a given year. It is the most commonly used measure of its economy’s productivity and income.

ECON 1100 Chapter Notes - Chapter 4: Old Age Security, Fixed Capital, Operating Surplus

Document Summary

Get access

Related Documents

ECON 1100 Chapter Notes - Chapter 4: Gross Fixed Capital Formation, Operating Surplus, Old Age Security

ECON 1100 Chapter Notes - Chapter 4: Operating Surplus, Small Business, Dry Cleaning

ECON 1100 Chapter Notes - Chapter 4: Gross Fixed Capital Formation, Gross Domestic Product, Intermediate Good

Related Questions