ECON102 midterm #1

ECON102 midterm #1 - Net Domestic Income at factor cost =...

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Recessionary Gap : Actual Real GDP < Potential Real GDP Inflationary Gap : Actual Real GDP > Potential Real GDP
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Output Gap (% potential) = Actual Real GDP – Potential Real GDP x 100 Potential
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Using Income approach, the value of GDP = factor payments (wages, interest income and business profits) + non- factor payments (depreciation, indirect taxes) – subsidies
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Unformatted text preview: Net Domestic Income at factor cost = sum of factor payments Nominal GDP = year A quantity * year A price % change in nominal GDP from a to b = [nominal GDP year B]/[nominal GDP year A]*100 -100 Real GDP = year A quantity * base year price % change in real GDP from a to b = [real GDP year B]/[real GDP year A]*100 -100 HOMEWORK 2 Ye = Co+Io 1- MPC...
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