Study Guides (248,633)
Canada (121,642)
York University (10,209)
Economics (643)
ECON 1010 (137)
Xueda Song (11)

ECON1010.docx

24 Pages
89 Views

Department
Economics
Course Code
ECON 1010
Professor
Xueda Song

This preview shows pages 1,2,3,4. Sign up to view the full 24 pages of the document.
Description
ECON1010Chapter5MeasuringaNationsIncomeLearningObjectivesConsiderwhyeconomystotalincomeequalsitstotalexpenditureLearnhowGDPisdefinedandcalculatedSeethebreakdownofGDPinto4majorcomponentsLearnthedistinctionbetweenrealandnormalGDPEconomicsisdividedintooMicroeconomicsthestudyofhowindividualhouseholdsandfirmsmakedecisionsandhowtheyinteractwithoneanotherinmarketsoMacroeconomicsthestudyoftheeconomyasawholeandeconomicchangesaffectinghouseholdsfirmsandmarketsMacroeconomistsaddresstheeffectsoftheeconomyasawholeoWhyisaverageincomedifferentinvariouscountriesoWhydopricesriserapidlyinsomeperiodsoftimewhiletheyremainstableinothersoWhydoproductionandemploymentexpandinsomeyearsandcontractinothersoWhatcanthegovernmentdotopromoterapidgrowthinincomeslowinflationandstableemploymentGrossdomesticproductGDPthetotalincomeofanationthemostcloselywatchedeconomicstatisticbecauseitisthoughttobethebestsinglemeasureofasocietyseconomicwellbeingTheEconomysIncomeandExpenditureThetaskoftheGDPistomeasuretheeconomyofacountrybylookingatitsincomeGDPmeasurestwothingsatonceoTotalincomeofeveryoneintheeconomyoTotalexpenditureontheeconomysoutputofgoodsandservicesGDPcanmeasurebothbecausetheyarereallythesameoForaneconomyasawholeincomeexpenditureoThisisbecauseeverytransactionhastwopartiesbuyerandselleroEachrevenuedollarisequivalenttoeachexpendituredollarItalsomeasurestotalexpenditureontheeconomysoutputofgsandthevalueoftheeconomysproductionoutputofgsGDPisalsoreferredtoasoutputEachtransactioncontributesequallytotheeconomysincomeandtoitsexpenditureoExJimpaysBob100ThetransactioncontributedequallytotheeconomysincomeandexpenditureandGDProseby100CircularFlowDiagramshowstheequalityofincomeandexpenditureoHouseholdsOwnfactorsofproductionsellrentthemtofirmsforincomebuygoodsandservicesfromfirmsTheseexpendituresflowthroughthemarketsforgoodsandservicesoFirmsBuyhirefactorsofproductionusethemtoproducegsusesalesrevenuestopaywagesrentandprofittofirmownersThisincomeflowsthroughthemarketsforthefactorsofproductionoGDPthemoneythehouseholdsspendthemoneythefirmsgeneratethroughrevenueoFactorsofProductioninputslikelabourlandcapitalnaturalresourcesoFactorpaymentspaymentstothefactorsofproductionogreenarrowsrepresentflowsofincomepaymentsoredarrowsrepresentflowsofgsincludingservicesofthefactorsofproductioninthelowerhalfofthediagramthisbasicCFDomitsthesefactorswhichdoesNOTchangetheroleofGDPmeasuringthecountrystotalincomeexpenditurerevenueandfactorpaymentsothegovernmentcollectstaxesbuysgsothefinancialsystemmatchessaverssupplyoffundswithborrowsdemandforloans
More Less
Unlock Document

Only pages 1,2,3,4 are available for preview. Some parts have been intentionally blurred.

Unlock Document
You're Reading a Preview

Unlock to view full version

Unlock Document

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit