MGEA06H3 Chapter : Week 2 chapter notes

• School: UTSC
• Department: Economics for Management Studies
• Course: MGEA06H3
• Professor: Iris Au

Document Summary

Chapter 20 the measurement of national income notes. N gdp = ca + ia + ga + (xa ima) N gdp is superior to gnp as a measure of domestic economic activity. N gdp deflator = (gdp at current prices) (gdp at base-period prices) 100 = (nominal gdp) (real gdp) 100. N gdp deflator index # derived by dividing nominal by real; its change measure average change in price of all items in gdp. N gdp deflator and cpi similarly reflect overall inflationary trends, but changes in relative prices may lead 2 price indices to change in different ways www. notesolution. com. N gdp does not measure illegal activities, even though many of them are ordinary business activities that produce goods and. N changes in real per capita income are a good measure of average material living standards. But material living standards are only part of what most people consider their overall well-being.