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19 Cards in this Set

  • Front
  • Back
What are the national income and product accounts (or national accounts)?
They keep track of the flows of money between different sectors of the economy.
What is comsumer spending?
Household spending on goods and services.
What is a stock?
It is a share in the ownership of a company held by a shareholder.
What is a bond?
It is borrowing in the form of an IOU that pays interest.
What are government transfers?
They are payments by the government to individuals for which no good or service is provided in return.
What is disposable income?
It is equal to income plus government transfers minus taxes. It is the total amount of household income avaliable to spend on consumption and to save.
What is private savings?
This is equal to disposable income minus consumer spending. It is disposable income that is not spent on consumption.
What are finanical markets?
They are the banking, stock, and bond markets which channel private savings and foreign lending into investment spening, government borrowing, and foreign borrowing.
What is government borrowing?
This is the amount of funds borrowed by the government in the finacial markets.
What are government purchases of goods and services?
They are government expenditures on goods and services.
What are exports?
They are goods and services sold to residents of other countries.
What are imports?
They are goods and services purchased from residents of other countries.
What is investment spending?
It is spening on productive physical capital, such as machinery and construction of structures, and on changes to investments.
What are final goods and services?
They are goods and services sold to the final, or end user.
What are intermediate goods?
They are goods and services bought from one firm by another firm, that are inputs for production of final goods and services.
What is gross domestic product (GDP)?
It it the total value of all final goods and services produced in the economy during a given year.
What is aggregate spending?
It is the total spending on domestically produced final goods and service in the economy, which are the sum of consumer spending, investment spending, governemnt purchases, and exports minus imports,
What is the value added?
The value added of a producer is the value of its sales minus the value of its purchases on inputs.
What are net exports?
They are the difference between the value of exports and the value of imports.