Chapter 5 [Compatibility Mode]

Chapter 5 [Compatibility Mode] - ECON 002 Introduction to...

Info iconThis preview shows pages 1–5. Sign up to view the full content.

View Full Document Right Arrow Icon
1 ECON 002 Introduction to Macroeconomics Chapter 5 Production, Income, and Employment ECON 002 Introduction to Macroeconomics Production and GDP • Gross domestic product (GDP) – Total value of – All final goods and services – Produced – For the marketplace – During a given year – Within the nation’s borders ECON 002 Introduction to Macroeconomics Stages of Production Figure 1 Stages of Production $1.00 (Wood Chips) Lumber Mill $1.50 (Raw Paper) Paper Mill $2.25 (Notebook Paper) Office Supplies Manufacturer $3.50 (Notebook Paper) Wholesaler $5.00 (Notebook Paper) Retailer
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 ECON 002 Introduction to Macroeconomics Production and GDP • Intermediate goods • Final good ECON 002 Introduction to Macroeconomics The Expenditure Approach to GDP GDP = C + I + G + NX Add up the value of the goods and services purchased by each type of final user ECON 002 Introduction to Macroeconomics Consumption Spending • The part of GDP purchased by households as final users • Largest component of GDP (70%) • Includes estimations for • Excludes
Background image of page 2
3 ECON 002 Introduction to Macroeconomics Private Investment • Components ECON 002 Introduction to Macroeconomics Private Investment • Excludes • Ignores depreciation ECON 002 Introduction to Macroeconomics Government Purchases • Spending by federal, state, and local governments on goods and services • Excludes • Transfer payments
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4
Background image of page 4
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 05/25/2010 for the course ECON 2 taught by Professor Mahalingam during the Winter '10 term at UC Riverside.

Page1 / 12

Chapter 5 [Compatibility Mode] - ECON 002 Introduction to...

This preview shows document pages 1 - 5. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online