ECON 201 Lecture Notes - Lecture 10: Intermediate Good, Gdp Deflator
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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. Gross domestic product (gdp) is the market value of all final goods and services produced within a country in a given period of time. It includes all items produced in the economy and sold legally in markets. Gdp excludes most items produced and sold illicitly, such as illegal drugs. It also excludes most items that are produced and consumed at home and, therefore, never enter the marketplace: ex: vegetables you buy at the grocery store are part of gdp; vegetables you grow in your garden are not. Gdp includes only the value of final goods. Gdp includes both tangible goods (food, clothing, cars) and intangible services (haircuts, housecleaning, doctor visits). Gdp includes goods and services currently produced.