gdp - Measuring the Gross Domestic Product Sandeep Bhaskar...

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Unformatted text preview: Measuring the Gross Domestic Product Sandeep Bhaskar Temple University Sandeep Bhaskar (Temple University) Measuring the Gross Domestic Product 1 / 17 Outline 1 Gross Domestic Product 2 Components of GDP 3 Calculating GDP Sandeep Bhaskar (Temple University) Measuring the Gross Domestic Product 2 / 17 Gross Domestic Product Gross Domestic Product It is the market value of all final goods and services produced in a country in a given period of time. No intermediate goods are included. Production has to be inside the country. Illegal activities and pro-bono work or work done at your home is not included in the GDP. Sandeep Bhaskar (Temple University) Measuring the Gross Domestic Product 3 / 17 Gross Domestic Product Two Approaches to Gross Domestic Product Expenditure Approach Add the expenditure of every part of the economy. Income Approach Add the income of every part of the economy. Sandeep Bhaskar (Temple University) Measuring the Gross Domestic Product 4 / 17 Gross Domestic Product Circular Flow Diagram Sandeep Bhaskar (Temple University) Measuring the Gross Domestic Product 5 / 17 Components of GDP Households Households own all factors of production, and hence get all the income from factors markets. The inflow is shown as Y in the circular flow diagram. They spend a part of it on consumption ( C ), they save a part of it ( S ), and they pay a part of it as taxes....
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This note was uploaded on 05/04/2011 for the course ECON 1101 taught by Professor Rappoport during the Fall '08 term at Temple.

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gdp - Measuring the Gross Domestic Product Sandeep Bhaskar...

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