Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
15 Cards in this Set
- Front
- Back
|
what is an intermediate good?
|
A Product that is purchased for resale or further processing or manufacturing
|
|
|
What is a final good?
|
A good and service that has been purchased for final use and not for resale or further processing or manufacturing
|
|
|
What is multiple counting?
|
Wrongly including the value of intermediate goods in the gross domestic product.
|
|
|
What is value added?
|
The value of the product sold by a firm, less the value of the products purchased and used by the firm to produce the product
|
|
|
What are the two types of nonproduction transactions?
|
Purely financial and second hand sales
|
|
|
What are the three types of Financial transactions?
|
Public transfer payments
Private transfer payments Stock-market transactions |
|
|
What are Public transfer payments?
|
The social insurance payments, such as welfare payments, and employment insurance payments that the gov't makes directly to households. Since the recipients contribute nothing t current production in return, inclusion of such payments in GDP would overstate the years output.(Remember Welfare)
|
|
|
What are private transfer payments?
|
Such payments include, for example, the money that parents give children or the cash gifts given at christmas time. They produce no output. They simply transfer funds from one individual to another and consequently do not enter GDP. (Remember Christmas)
|
|
|
What are Stock-market Transactions? (in relation to Financial Transactions)
|
Is just a matter of swapping bits of paper. Do not directly contribute to current production and are not included in the GDP. Payments for the services of a security broker are included, however, because those services do contribute to current output.
|
|
|
What are Second hand sales?
|
Selling something used. Does not contribute to the GDP
|
|
|
What are the two ways of calculating GDP?
|
Expenditures approach
Income approach |
|
|
What is the Expenditures approach?
|
Adds all expenditures made for final goods and services to measure the GDP
|
|
|
What is the Income approach?
|
adds up all the income generated by the production of final goods and services to measure the GDP
|
|
|
What are Personal Consumption expenditures?
|
The expenditures of households for durable and non-durable consumer goods and services.
|
|
|
What is gross investment?
|
Expenditures for newly produced capital goods (such as machinery, equipment, tools, and buildings) and for additions to inventories.
|
