ECON103 Chapter Notes - Chapter 7: Gross Domestic Product
14 Mar 2016
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National income accounting measures the economy"s overall performance. Aggregate output annual total output of goods and services: used as the primary measure of the economy"s performance. Ex: if toyota (a japanese company) outsources their production to the. United states, and their goods are produced in ohio, the money made is counted towards the united states" aggregate output. Intermediate goods products that are purchased for resale or further processing or manufacturing: ex: crude oil, steel beams, and vegetables for salads. Final goods products that are purchased by their end users: ex: gasoline for cars, high-rise buildings made by steel beams, and salads sold by restaurants. Multiple counting the value of a good being counted two or more times by counting the value of the intermediate goods and final goods. Value added market value of a firm"s output minus the value of the inputs the firm has bought from others: helps avoid multiple counting.
