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13 Cards in this Set

  • Front
  • Back
  • 3rd side (hint)
what is GDP
Gross Domestic Product is the market value of all goods produced by a country at a given time
How does the department of Commerce measure GDP
The Department of Commerce measures GDP by adding purchases of final goods and services produced during a given year
what does the Department of Commerce exclude?
The department of Commerce excludes items produced and sold to businesses that use them to produce other things
i.e. it counts the cost the jeans but not the effort/items used to make it
Does GDP accurately measure changes from one year to another? If yes or no then why
No, GDP does not measure changes accurately from 1 year to another. This is due to inflation
what is real GDP
Real GDP is inflation-adjusted GDP and shows changes in real production
what is best indication of a nation's standard of living
The per capita GDP is the best measure of a nation's standard of living. And it is found by dividing real GDP by a country's total population
Labor productivity
the amount a workforce can produce at a given time
output of goods as measured per unit of input
When does per capita GDP increase? and what makes it increase
per capita GDP only increases when the production of goods& services grows faster than the population. Increasing labor force productivity makes it increase
what are the 3 human resources that increase productivity
1) quantity of education
2) quality of education
3) worker's enthusiasm
how does the quality of management increase productivity
6 reasons
1) innnotative management i.e. Ford
2)a seemingly insignicant decision that yields big increases
3)customer satisfaction
4) hi-quality workmanship, which buyers recognize& demand
5) empowerment: managers listen to employee ideas
6)shared vision/goals between the employee and employer
law of diminishing
as more variable resources are added to a fixed amount, in an an effort to expand production, at some point the amount produced eventually diminishes
why does the law of diminishing occurs
the law of diminshing occcurs because variable costs crowd fixed costs of other resources. The marginal of producing an additional batch of chips will be greater than the 1 prior to it