Management and Organizational Studies 2275A/B Chapter Notes - Chapter 2: Fixed Investment, Income Approach, Accounting

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 2275A/B
• Professor: Desmond Mc Keon

Document Summary

Provides accurate and systematic measures of aggregate economic activity of a nation. Uses standardized measurements of macro variables based on accounting principles. Market value of all final goods and services produced in an economy during a fixed period of time. Product approach: gdp equals sum of all final goods and services produced in the economy at their market value. Expenditure approach: gdp equals sum of all final goods and services purchased in the economy, gdp = personal consumption expenditure (c) Sum of all income received by workers, the government, and firms: gdp = workers" income. Private disposable income (yd): the amount of income that households have to spend, the income received from all sources, less taxes, gdp + net factor payments (nfp) + transfers (tr) + domestic interest payments (int) taxes (t) Private saving (spvt): private disposable income (yd) consumption (c) Government saving (sgovt): net government income government purchases (g)