Economics 1022A/B Chapter Notes - Chapter 20: Potential Output, Business Cycle, Final Good

• School: Western University
• Department: Economics
• Course: Economics 1022A/B
• Professor: Desmond Mc Keon

Document Summary

Gdp is the market value of all the final goods and services produced within a country in a given time period. Gdp can be measures by the expenditure on goods and services or the income earned producing goods and services. Gross means before the depreciation of capital and domestic is measures after the depreciation of capital. An intermediate good is a component of a final good whereas a final good is bought by a final user during a specific period of time. To make total income equal to gdp, we add indirect taxes less subsides and add deprecation. Nominal gdp is the value of the final goods and services produced in a given year valued at the prices of that year (more precise name for gdp) Real gdp is the value of final goods and services produced in a given year when valued at the prices of a reference base year.