Additional notes for lecture 2 economics 104 15 gdp

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Unformatted text preview: he di↵erence? GDP: Gross Domestic Product — what’s produced within the country no matter who owns the factors of production (labour, capital) GNP: Gross National Product — what’s produced by the factors of production owned by residents of the country, whether produced here or in other countries. (Expenditure measure) GNI: Gross National Income — income for factors of production owned by residents of the country. (Income measure) GNP = GNI The di↵erence between GDP and GNI is (1) net investment income from non-residents and (2) net compensation received by non-resident employees.1 GNI = GDP + (resident’s investment income from investments abroad non-resident’s investment income from domestic investments) + (resident’s compensation (e.g. wages) for work abroad non-resident’s compensation for work in domestic economy) The text identifies the di↵erence as net foreign investment income. I am using Statistics Canada’s terminology. As well, the text ignores net compensation, which is fair enough since it is a very small number. 1 Additional Notes for Lecture 2 Economics 104 GNI = GDP + net investment income from non-residents +net compensation received by non-resident employees For Canada, GNI < GDP; net income flows abroad are negative. (in millions) 2013 Q3 Share of GDI Gross Domestic Income 1,887,804 100% Net investment income from non-residents -26,956 1.4% Net compensation received by non-resident employees -2,180 0.1% Gross National Income 1,858,668 98.5% 16 Economics 104 12 Unemployment The Labour Force : total number of employed and unemployed people in the economy. Labour Force = Employed + Unemployed Employed — any paid work or self-employment. Unemployed — not working but actively looking for work; or about to start work in the future. Not in the Labour Force — e.g. full time students, retirees The Unemployment Rate Unemployment Rate = 100 ⇥ Unemployed Employed + Unemployed Unemployment does not measure: – Discouraged workers — people who would like to work but have not been actively looking for work. – Involuntary part...
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This homework help was uploaded on 03/03/2014 for the course ECON 104 taught by Professor Voss during the Spring '10 term at University of Victoria.

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