SU_ECO2072_W2_A2_Dunn_K - Economic Performance By Kimbra...

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Economic Performance By Kimbra Dunn Principles of Macro-Economics
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3 BY KIMBRA DUNN ECONOMIC PERFORMANCE A nation’s economy is the heart and soul of society. When judging the overall economic well-being, gross domestic economy product (GDP) is used. This measures whether the economy is doing well or poorly. GDP measures is the market value of all final goods and services produced with in a country in given period of time (Mankiw, N. G. 01/2014). GDP measures two important aspects of the economy at once. The total income of everyone in the economy and the output of goods and services. The reason GDP is able to do this is because the economy’s income is the same as its expenditures, since every transaction has two parties: the buyer and seller. GDP measures the flow of income and the flow of expenditure that takes place within a specific interval of time. One thing that is always true, is that the economy is always changing. Price of a good or service along with output of goods and services constantly change in an economy. When measuring changes over time, separation of these effects is necessary. To do this, economist use
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