02.Macroeconomics

Leakages in Economy

1. Imports

2. Savings

3. Taxes

Injections into economy - 3

1. Exports

2. Investment

3. Gvt spending

Embedded Economy or Donut economy

1. What is it

1. Which includes non-monetary factors like env, living etc

Aggregate Demand or expenditure method of GDP

AD = C + G + I + (X-M)

Income method GDP components

1. Rent

2. Wages

3. Interest

4. Profit

Long term aggregate supply and potential GDP

They are same

Savings and investment relation

Savings + taxes + Imports = Investment + Gvt spending + exports

(derived from using C+S+T (househol spending) = C+I+G+(X-M) (aggregate demand))

savings investment relation

S - I = (X- M){negative of CAD} + (G - T){deficit}

Full employment and Zero unemployment

They are not same

Full employment is natural rate of unemployment

What is National Income

NNP at Factor cost

GDP and GNP relation

GNP = GDP + NFIFA

Net Investment - Gross Investment

Depreciation

New base year of GDP

2022-2023

Factor cost vs Basic price vs Market price

GDP calculation before and after 2015

1. Who calculates

2. Method used

3. Bias

4. Database

5. Headline growth

6. sector wise estimates

7. finance sector coverage

1. NSSO vs NSO (NSSO+CSO)

2. Production method (20,000 firms) vs Value addition(All formal firms)

3. Towards Industries vs no bias

4. Annual survey of Industries vs MCA-21 database

5. GDP-FC vs GDP-MP

6. GVA-FC vs GVA-BP

7. very less comprehensive(just few banks) vs banks, SEBI, IRDA,PFRDA

Is this included in GDP

1. bank buying/selling shares?

2. bank interest rate

3. Bank interest rate spread?

4. bank fee we pay for services

5. fee for brokerage for zerodha etc

1. No, no new assets

2. Not direct interest rate

3. yes, the spread of ledning rate - deposut rate

4. yes

5. yes

SNA meeting third time expected date

1. 2025/2026

Green GDP

GDP - Env costs

1. GNP = (gDP terms)

2. GNP = (NNP terms)

3. NNP = (NI terms)

4. NI = (incomes)

5. PI =

1. GDP + NFIFA

2. NNP + Depreciation

3. NI + Net taxes

4. Personal income + Undistributed profits + Net interest payment by household - transfer payments

5. PDI + Personal Tax + NP

national disposable income vs Personal diposable income

1. It includes the money the nation have it at its disposal.

NDI = NNP at MP + Current transfers from foreign

2. PDI = PI - Personal tax - Nontax fees etc