[ECO2121] - Final Exam Guide - Everything you need to know! (25 pages long)

• School: University of Ottawa
• Department: Economics
• Course: ECO 2121
• Professor: Ram Acharya

Document Summary

Lecture #2: )ntroducing balance of payments in a country"s national account. An economy"s income is the same as expenditure because every transactions. For every economy as a whole, income must equal expenditure: every dollar of spending by some buyer is a dollar of income for some have two properties: a buyer and a seller seller. We will start with a closed economy, where a country does not deal at all with non-residents or non-nationals. Subsequently, as we will open the economy where goods, capital and labor mobility is allowed across countries. A closed economy is characterized by a circular flow of payments. At the top is gross national expenditure (gne) or gross national product (gnp), the total expenditure on final goods and services produced in any given period of time (a calendar year) Flow of payments in a closed economy: plants and. Gne is made up of three parts: personal consumption (c), investment (i) and government spending (g).