ECON Chapter 10 – Flashcards
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What is the formula for GDP
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C(consumption)+I(Investment)+G(Gov Purchases)+NX(Net Exports)
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What is a Transfer Payment
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a form of government spending that is not made in exchange for a currently produced good or service.
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The GDP deflator for years subsequent to the base year measures the change in..
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nominal GDP from the base year that cannot be attributable to a change in real GDP.
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Real GDP will increase
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Price up;Quantity up
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Goods that go into inventory and are not sold during the current period are
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Included in GDP as inventory investment
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Disposable Household Income
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household money available to spend
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GNP
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Total income by national permanent residents(nationals)
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NNP
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GNP-depreciation
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GDP Deflator
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Nominal GDP/Real GDP x100
a measure of price level
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Real GDP Calculation
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(# of product)(price in base)+(# of product)(price in base)
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Investment
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Spending on capital equipment, inventories, and structures
ex: a purchase of a computer by an accounting firm.
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Inflation Rate
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(deflator year 2-deflator year 1)/deflator year 1 x100
