Growth_review_handout

Growth_review_handout - Review: Midterm I Growth Summary of...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Review: Midterm I UIUC Econ303 Zhao 1 Growth Summary of important slides Measure the aggregate economic activity Gross Domestic Product (GDP) is the market value of an economy's domestically produced goods and services over a specified period of time. – By production: GDP= sum of value added in all production units – By expenditure: GDP = consumption + investment + government spending + net export –B y i n c om e GDP= wage + interests, rents, and profits + depreciation + indirect taxes • Inflation measured by GDP deflator
Background image of page 1

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

View Full DocumentRight Arrow Icon
Review: Midterm I UIUC Econ303 Zhao 2 Measure the aggregate economic activity The Unemployed are those who currently do not have a job but are actively searching for one in the last four weeks. Labor force is the sum of the employed and the unemployed. • Unemployment rate = Number of the unemployed / Labor force * 100 % • Labor force participation rate = Labor Force / Adult population * 100 % GDP and GDP Growth across Nations • Average annual growth rate over a period of time – GDP per capita year n = (1+x) n * GDP per capita year 1 – x = (GDP per capita year n / GDP per capita year 1) 1/n -1 – Approximately x = ln(1+x) = (ln GDP per capita year n – ln GDP per capita year 1)/n • Four facts of GDP and its growth across nations – A big income disparity – Disparity has been constant overall but various in sub regions – All most all countries are growing – Big disparity in growth rate
Background image of page 2
Review: Midterm I UIUC Econ303 Zhao 3 Production function • A plan to transform input to output is represented by production function • Marginal product (MP) – is the change of output / change of one input, while keep all the other input at a fixed level. – MP is the slope of the production function.
Background image of page 3

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

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

Page1 / 12

Growth_review_handout - Review: Midterm I Growth Summary of...

This preview shows document pages 1 - 4. Sign up to view the full document.

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