march 21 lecture notes

march 21 lecture notes - produced by permanent residents of...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Introduction o International trade refers to the exchange of merchandise and services among countries of the world o International finance refers to the exchange of assests among the countries of the world Global exchange of assets in the world economy has at times been nearly 100 times check slides Circular Flow o Production process of the firm generates income that accrues to the Household Income (y) consists of wages, salaries, and payments for the use of property assets Given the simple assumption of this chapter, (y) is also equal to both the nominal gross national product (GNP) and the nominal gross domestic product (GDP) of Mexico GDP is the market value of all final goods and services produced within a country in a given time GNP the market value of all final goods and services
Background image of page 1

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

View Full DocumentRight Arrow Icon
Background image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: produced by permanent residents of a nation within a given period of time Consumption process of the household generates consumption expenditures that accrue to the firm (c) When you open the circular flow chart (open economy) we see government, rest of the world, and capital, see figure 12.2 in textbook • 3 types of savings: Households, governments firms • Open-Economy Accounts o The rest of the world interacts with the Mexican economy – foreigners’ account in Mexico’s Books Makes an expenditure in the form of its purchases of Mexico exports (E) Receives income in the form of Mexico’s purchases of imports (z) Makes an expenditure that accrues to capital in the form of foreign savings (Sf)...
View Full Document

This note was uploaded on 05/08/2011 for the course IR 213 taught by Professor Staff during the Spring '08 term at USC.

Page1 / 2

march 21 lecture notes - produced by permanent residents of...

This preview shows document pages 1 - 2. Sign up to view the full document.

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