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15 Cards in this Set

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Gross domestic product
(GDP)
The market value of all final goods and services produced in a nation during ia period of time, usually a year.
Gross national Product (GNP)
This market value of all final goods and services produced by a nation's residents, no matter where they are located
Transfer Payment
A government payment to individuals not in exchange for goods or services currently produced.
Final Goods
finished goods and services produced for the ultimate user.
Intermediate goods
Goods and services used as inputs for the production of final goods
Circular flow model
A diagram showing the flow of products from business ro households and the flow of resources from households to businesses. In exchange for these resources, money payments flow between businesses and households.
Flow
A rate of change in a quantity during a given time period, such as dollars per year. For example, income and consumption are flows that occur per week, per month, or per year.
Stock
A quantity measured at one point in time. For example, an inventory of goods or the amount of money in a checking account.
Expenditure approach
The national income accounting method that measures GDP by adding all the spending for final goods during a period of time.
Income approach
The national income accounting method that measures GDP by adding all incomes, including compensation of employees, rents, net interest, and profits.
Indirect business taxes
Taxes levied as a percentage of the prices of goods sold and therefore collected as part of the firm's revenue. Examples include general sales taxes, excise taxes and customs duties.
National Income (NI)
The total income earned by resource owners, including wages, rents, interest, profits, and indirect business taxes. NI is calculated as gross domestic product minus depreciationof the capital worn out in producing output.
Personal Income (PI)
The total income recieved by households that is available for consumption, saving, and payment of personal taxes
Disposable Personal income (DI)
The amount of income that households actually have to spend or save after payment of personal taxes.
Nominal GDP
The value of all final goods based on the prices existing during the time period of production