Economics 012 2-7-2008

Economics 012 2-7-2008 - -Government expenditures on goods...

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Economics 012—2/7/2008 - Transfer Payments: money people receive for doing nothing o Ex: social security, welfare, Christmas checks, etc o Not included in GDP - Output=income o If tomatoes were sold at retail for $1,000 then there must be $1,000 in income o Measure GDP by market value of all goods and services o Measure all incomes that people derive from that output Both numbers should be the same - Gross investment= all such investments o Replaces worn out capital - Capital stock only grows to extent that gross investment exceeds
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Unformatted text preview: -Government expenditures on goods and services o Excludes transfer payments o Includes firefighters, police, etc. Things the government provides for citizens o Only big item in GDP by the government is National Defense-Net exports o Total exports=imports-exports-Income of unincorporated estimates o Schedule C income -Rental income of individuals-Returns to capital o Net interest payment-Corporate profits o Taxes—corporate profits= net profits o Retained earnings= business savings...
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