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32 Cards in this Set

  • Front
  • Back
Base Year
A base year is the year chosen for the weights in a fixed-weight procedure.
Current Dollars
The current prices that one pays for goods and services
The amount by which an asset's value falls in a given period
Disposable personal income
(after tax income) Personal income minus personal income taxes. The amount that households have to spend or save
Durable Goods
goods that last a relatively long time, such as cars and household appliances.
Expenditure Approach
A method of computing GDP that measures the amount spent on all final goods during a given period
Final Goods and Services
Goods and services produced for final use
Fixed-Weight procedure
A procedure that uses weights from a given base year
Government Consumption and Gross Investment
(G) Expenditures by federal, state, and local governments for final goods and services
Gross Domestic Product (GDP)
The total market value of all final goods and services produced within a given period by factors of production located within a country
Gross National Product
(GNP) The total market value of all final goods and services produced within a given period by factors of production owned by a country's citizens, regardless of where the output is produced
Gross Private Domestic Investment
(I) Total investment in capital - that is, the purchase of new housing, plants, equipment, and inventory by the private (or nongovernment) sector
Income Approach
A method of computing GDP that measures the income - wages, rents, interest, and profits - received by all factors of production in producing final goods.
Intermediate Goods
Goods that are produced by one firm for use in further processing by another firm
National Income
The total income earned by the factors of production owned by a country's citizens
Net Exports
(EX - IM) The difference between exports (sales to foreigners of U.S. produced goods and services) and imports (U.S. purchases of goods and services from abroad). The figure can be positive or negative.
Net Factor Payments to the Rest of the World
Payments of factor income to the rest of the world minus the receipt of factor income from the rest of the world
Net Interest
The interest paid by business
Net Investment
Gross investment minus depreciation
Nominal GDP
Gross domestic product measured in current dollars
Nondurable Goods
Goods that are used up fairly quickly, such as food and clothing
Per Capita GDP or GNP
Personal Consumption Expenditures
(C) A major component of GDP: expenditures by consumers on goods and services
Personal Income
The total income of households. Equals (national income) minus (corporate profits minus dividends) minus (social insurance payments) plus (interest income received from the government and households) plus (transfer payments to households). The income received by households after paying social insurance taxes but before paying personal income taxes.
Personal Saving
The amount of disposable income that is left after total personal spending in a given period
The things we buy that do not involve the production of physical things such as legal and medical services and education.
Payments made by the government for which it receives no goods or services in return
Underground Economy
The part of the economy in which transactions take place and in which income is generated that is unreported and therefore not counted in GDP
Value Added
The difference between the value of goods as they leave a stage of production and the cost of the goods as they entered that stage
The importance attached to an item within a group of items
1) C + I + G + (EX-IM)
2) Final sales + change in business inventories
3) National income + Depreciation + (indirect taxes - subsidies) + net factor payments to the rest of the world + Other
Changes in BEA Approach for determining GDP Deflator (not fixed-weight)
1) Using Both time periods being compared as base years
2) Geometric Average of the % change using the 2 time periods being compared each as a base year