GDP

GDP definition

Market value of all new final goods and services produced in an economy over a period of time

How to find GDP per capita

GDP divided by population

Market value

(Price X quantity) and add each together

what is not in GDP calculation?

Financial transactions, public transfer payments, private transfer payments, stock market transactions, second hand sales

To find nominal GDP

Current price X current quantity

To find real GDP

Base year price X current quantity

To find GDP price index

(Price of market basket in specific year / price of same basket in base year) X 100

To find price index

(Current price X current quantity) / (base year price X current quantity)

All multiplied by 100

For the base year the nominal GDP the real GDP

Equals

2 ways to measure GDP

Expeditive approach and income approach. Both are equal

GDP expenditure formula

GDP= C + I + G + (x-m)

Consumption, investment, government purchases, (exports-imports)

Consumption is purchases of goods and services by

Households

Durable goods

Last more than 3 years

To avoid double counting use

Only final goods and services

Only goods are included in GDP

New

Example of investment

Amount spent on new factory machinery equipment

Percentage increase formula

((New value -old value) / old value ) all x 100

Total value of imported cars is —

included in C of GDP

Net exports are negative when

a nation's imports exceed its exports.

National income is

incomes earned by U.S. resource suppliers plus taxes on production and imports

Disposable income is

income received by households less personal taxes

Nominal GDP is

the sum of all monetary transactions involving final goods and services that occur in the economy in a year.

Net exports are

exports less imports.

GDP excludes

the market value of unpaid work in the nome

Real GDP measures

current output at base year prices.

Real GDP refers to

GDP data that have been adjusted for changes in the price level.

The agency responsible for compliance the National Income Product Accounts for the U.S, economy is the

Bureau of Economic Analysis

Price index

a comparison of the current price of a market basket to a fixed point of reference.

GDP FORMULA

can be found by summing C + g + G + Xn