GDP (expenditure & total market value approach)

gdp (gross domestic product)

total market value of final goods & services within a country during a given period (year)

indicator of economic performance in terms of aggregate output (totality of all products produced) and product capacity

market value

amount of products being sold in an economy

total market value

(total qty unit x price per unit) + (however many more there are) = gdp

includes tangible items such as education, healthcare, etc

final goods & servies

end product of a process

product being sold in the market & bought by a consumer

intermediate goods

raw goods, not included in gdp

domestic

means we are only measuring the gdp of 1 country

foreign companies with branches in other places will be counted to that country’s gdp

during a given period

gdp is only concerned with new/current production

old production is not counted due to fact that it was counted to gdp at the time of its production

expenditure approach

total value spent by 4 different economic sectors

C + I + G + Nx = gdp

consumption

spending of households on goods such as foods clothing entertainment from domestic services (tangible & intangible)

investment

spending of firms on final goods, mainly capital goods

capital goods

equipment used to make products

ex. factories

government purchases

final goods & services bought by ___ to provide social services for the people

transfer payment

subsidies, not included in gdp

net export

value of country’s total exports of goods minus total imports

balance between exports & imports

-Nx = trade deficit, +Nx = trade surplus