Measuring a Nation's Income

Measuring a Nation's Income - Macroeconomics Measuring A...

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Macroeconomics Measuring A Nation’s Income Macroeconomics: the study of economy-wide phenomena including inflation (pie symbol), unemployment, and economic growth Gross Domestic Product: The market value of all final goods and services produced within a country in a given period of time (Measures the total income of everyone in the economy and the total expenditure on the economy’s output of goods and services) GDP 2007 GDP 2008 $10 $80 -$10 Gross National Product: Total income earned by a nation’s permanent residents. Components of GDP: Y=c+i+g+nx Y=income(gdp) C=consumption I=investment G=gov’t spending NX=x-m=net exports X=exports M=imports Consumption: spending by households on goods and services with exceptions of new housing. Investment: spending on capital equipment, inventories and structures including new housing. Government Purchases: spending on goods and services by government. Does not include transfer payments Net exports: Spending on domestically produced goods by foreigners minus spending on
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Measuring a Nation's Income - Macroeconomics Measuring A...

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