Chapter 2

Chapter 2 - Chapter 2: The U.S. Economy Gross Domestic...

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Chapter 2: The U.S. Economy Gross Domestic Product – total market value of all the goods and services a nation produced Per Capita GDP – people based measure of economic performance Total output divided by total population Indicator of how much output the average person would get if all output were divided up evenly among the population. Economic Growth On average, U.S. output has grown by roughly 3 percent a year, nearly three times faster than population growth (1 percent). Nearly75% of U.S. output consists of services, not goods. America is primarily a service economy and will become increasing so in the future. Four major uses of total output (GDP) are: Consumption o Everything from breakfast cereals to movie rentals and college education o Accounts for over 2/3 of all output Investment o Plant, machinery, equipment, and structures that are produced for the business sector o Used to: Replace worn out equipment in factories, thus maintaining our production possibilities
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This note was uploaded on 04/18/2008 for the course ECON 202 taught by Professor Woroby during the Spring '08 term at Towson.

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Chapter 2 - Chapter 2: The U.S. Economy Gross Domestic...

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