200910 Chapter 9: financing week 9- - Google Docs

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nellyxo20

6 Jun 2018

School

UWS

Department

University of Western Sydney

Course

200910

Professor

Neha

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Chapter9EnterprisePerformanceandtheMacroeconomic

environment

Chapter10.1and10.2

1.Explainhowtotalproductioninaneconomyismeasured.

2.DiscusswhetherGDPisagoodmeasureofeconomicwellbeing.3.

DiscussthedifferencebetweenrealGDPandnominalGDP.

4.Understandhowtheeconomicgrowthrateismeasured.

5.Discusstheimportanceoflongruneconomicgrowthandits

impactonlivingstandards.

6.Discusstheroleofthefinancialsysteminfacilitatinglongrun

economicgrowth.

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9.1TotalproductionismeasuredbyGrossDomesticProduct(GDP)Gross

domesticproduct(GDP):Themarketvalueofallfinalgoodsand

servicesproducedinacountryduringaperiodoftime.GDPis

measuredusingmarketvaluesindollartermsofallthegoodsandservices

produced,notquantities.



GDPincludesonlythemarketvalueoffinalgoodsandservices.

Finalgoodorservice:Anewgoodorservicewhichistheendproductof

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theproductionprocessthatispurchasedbythefinaluser.Intermediate

goodorservice:Agoodorservicethatisaninputinto

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anothergoodorservice.Breadisafinalgoodandflourisanintermediate

good.



GDPincludesonlycurrentproduction.

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–Currentproductionisthatwhichtakesplaceduringtheindicatedtime

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period;GDPdoesnotincludethevalueofused(secondhand)goods.

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AlternativewaytocalculateGDP

valueaddedmethodvalueadded:Themarketvalueafirmaddstoa

productandisequaltothedifferencebetweenthepricethefirmsellsa

goodforandthepriceitpaidotherfirmsforintermediategoods.

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NetDomesticProduct(NDP):CalculatedbymeasuringGDPand

subtractingthevalueofdepreciationoncapitalequipment.

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GrossnationalincomeAustralia’sGDPplusincomegenerated

overseasbyAustralianresidentsandfirms,minustheincomegeneratedin

Australiabynonresidentsandforeignfirms

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MeasuresofmeasuringGDP:

TheAustralianBureauofStatistics(ABS)usesthreealternativemethodsto

measureGDP1.PEI

Productionmethodsumofthevalueofallgoodsandservicesproducedby

economyCOGS

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•Theproductionmethod:Thesumofthevalueofallgoodsandservices

producedbyindustriesintheeconomyinayearminusthecostofgoods

andservicesusedintheproductionprocess,leavingthevalueaddedby

theindustries.

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2.expendituresumoftotalexpenditureongoodsandservicesby

households



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Related Questions

Consider an economy that produces only chocolate bars. In year 1, the quantity produced is 3 bars and the price is $4. In year 2, the quantity produced is 4 bars and the price is $5. In year 3, the quantity produced is 5 bars and the price is $6.

Using year 1 as the base year, compute nominal GDP, real GDP, and the GDP deflator for each year.

Year	Nominal GDP	Real GDP	GDP Deflator
Year	(Dollars)	(Dollars)	GDP Deflator
Year 1
Year 2
Year 3

The percentage growth rate of real GDP from year 2 to year 3 is. ______%

The inflation rate as measured by the GDP deflator from year 2 to year 3 is. ______%

greentiger355

ch. 10

11. Problems and Applications Q5

Using year 1 as the base year, compute nominal GDP, real GDP, and the GDP deflator for each year.

Year	Nominal GDP	Real GDP	GDP Deflator
Year	(Dollars)	(Dollars)	GDP Deflator
Year 1
Year 2
Year 3

The percentage growth rate of real GDP from year 2 to year 3 is __________

The inflation rate as measured by the GDP deflator from year 2 to year 3 is ____________

TABLE 1 : In 2013
Item	Quantity	Price
Bananas	100	$10 a bunch
Coconuts	50	$12 a bag

TABLE 2: In 2014
Item	Quantity	Price
Bananas	110	$15 a bunch
Coconuts	60	$10 a bag

An island economy produces only bananas and coconuts. Table 1 gives the quantity produced and prices in 2013 and Table 2 gives the same information for 2014.

1. Nominal GDP in 2013 is __________.

2. Nominal GDP in 2014 is __________.

3. Real GDP (in terms of 2013 prices) in 2013 is __________.

4. Real GDP (in terms of 2013 prices) in 2014 is __________.

5. The % increase in nominal GDP from 2013 to 2014 is __________.

6. The % increase in real GDP from 2013 to 2014 is ___________.

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200910 Chapter 9: financing week 9- - Google Docs

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