ECO 1102 Lecture Notes - Lecture 3: Gdp Deflator

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Microeconomics: the study of how individuals and how firms make decisions and how they interact in markets. Macroeconomics: the study of economy- wide phenomena, including inflation, unemployment, and economic growth. Gross domestic product (gdp): measures the total income of a nation; the most closely watched economic statistic because it is the best measure of a society"s economic well-being. Total expenditure on the economy"s output of goods and services. Gdp: the market value of all final goods and services produced within a country in a given period of time. Adds together many different kinds of products into a single measure of the value of economic activity. Includes all items produced in the economy and sold legally in markets. Includes market value of the housing services provided by the economy"s stock of housing. Some products are excluded from the gdp, too hard to measure them. Includes only the value of the final good.

Related Questions

Which of the following statements about GDP is correct

A) Money continuously flows from households to firms and then back to households, and GDP measures this flow of money

B) GDP measures two things at once: the total income of everyone in the economy and the total expenditure on the economy’s output of goods and services.

C) While not perfect, GDP is generally regarded as the best single measure of a society’s economic well-being.

D) All of the above are correct.

emeraldmarten620

Gross Domestic Product (GDP) only measures the value of marketed goods and services for a country during a given period of time.

Is the GDP measure underestimating or overestimating national production and total income in the economy? Why?

What are the limitations of the GDP in measuring total output and national welfare? What products (services) are excluded from the GDP computation?

ambergnu461

An improvement in technology causes the production possibilities frontier (PPF) to

	shift to the right.
	pivot upward.
	shift to the left.
	pivot downward.

(7)

Which of the following is not shown by the circular flow model?

	The flow of resources in one direction and money in the other
	The equality of aggregate spending and aggregate income
	The interaction of households, firms, and the government
	The total amount of goods and services the economy can produce

(8)

Gross domestic product (GDP) is defined as

	the market value of all final goods and services produced in an economy in a given period of time.
	the market value of all consumption goods and services produced in an economy in a given period of time.
	the market value of all investment goods and services produced in an economy in a given period of time.
	the real value of all investment goods and services produced in an economy in a given period of time.

(9)

Real GDP

	includes all domestic and foreign transactions.
	includes the dollar value of domestic transactions only.
	tries to isolate the effect of changing output, holding prices constant.
	measures GDP in terms of prices of goods and services produced.

(10)

When economists talk about economic growth, they are usually referring to

	the percentage change in nominal GDP.
	the percentage change in real GDP.
	the percentage change in nominal investment.
	the percentage change in real investment.

chocolateant769

ECO 1102 Lecture Notes - Lecture 3: Gdp Deflator

ECO 1102 Full Course Notes

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