Calculating its value three approaches product

This preview shows 4 out of 7 pages.

Calculating its Value – Three Approaches Product Approach – Rather than looking at the final sale, utilize a “value-added” approach Q: how much each industry contributes the the value of the final good or service? Start from the raw material and see how much market value is added at each stage Value of sold – value of intermediate inputs used Value added at each stage must sum up to the final value of the final product Input-Output tables
Image of page 4

Subscribe to view the full document.

Calculating its Value – Three Approaches Use of imputation to estimate the value of some components Esp. Government production is imputed by summing up the payments to workers, payments for intermediate goods and services, allowance for depreciation of assets What about household production for own use? Not counted at all! GDP = Business production + household and institutions production + government production
Image of page 5
Calculating its Value – Three Approaches Spending Approach – adding up the value of newly produced goods and services bought by the sectors Personal consumption expenditures – spending by households and institutions Gross private domestic investment – spending by businesses on e.g. fixed assets
Image of page 6

Subscribe to view the full document.

Image of page 7
You've reached the end of this preview.
  • Fall '11
  • boun
  • Inflation, Gdp, gross domestic product, National accounts, Consumer price index, GDP deflator

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern