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ECO 1102 Study Guide - Midterm Guide: Xm Satellite Radio, Canada Pension Plan, Gdp Deflator

Course Code
ECO 1102
Najib Khan
Study Guide

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difference in value is due to beliefs and equity
difference in scientific judgement is based on policies used to stabilize economy
Economists 90% aggree with
Circular Flow Chart
-expenditures flow from household to firm
-labour flow from household to firm
-goods flow from firms to households
-income flows from firms to households
GDP-measure of market value
-the value of a company can be described in terms of its intrinsic value, book
value, actual cash value or market value.
-measures the total income of a nation; most watched statistic to measure the
society's economic well being.
"GDP is the market value of all final goods and services produced within a country
in a given period of time"
-use of goods by other firms for their own final products (ex. syrup used by
Freshloaf for their bread, and the syrup comes from Graincorp, hence the syrup is
an inetrmididate product and is not included in the final goods and services
produced for GDP).
-If we don't put any restirctions in terms of counrting only the final product, then
we may end up counting the same product for the GDP calculation like 5 or 6
times. So ONLY ACCOUNT FOR FINAL goods and services in every firm.
-GDP includes both tangible goods and intangible services produced
-Has to be produced within country's borders (hence teh first exercise in week 2
notes, debbie's purchase from a product PRODUCED in Boston will NOT count in
the GDP, Boston is in another country of USA, not her current country Canada).-
->general motors part, it will count becasue even though the company is american,
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