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8 Cards in this Set
- Front
- Back
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What is GDP? |
The total market value of all final goods and services produced in a country in a given period of time. |
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Discuss the relationship between saving and investment. |
Saving must equal Investment. S = I |
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Show the equations and discuss the various forms of saving. |
National Saving - the total income is based off of the consumption and the government purchases.
Private Saving - the income left determined by paying taxes and consumption. (Y-T-C)
Public Saving - the tax revenue and the paying for spending. (T-G) |
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What is crowding out? |
When the government borrows money to finance the budget deficit and reduces the supply of loanable funds. |
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Define Nominal GDP. |
Value of products and services at current prices. |
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Define Real GDP. |
Value of goods and services at constant prices. |
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Define GDP Deflator. |
Nominal GDP / Real GDP |
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Is GDP a good measure of economic well-being? |
No; 1. The value of leisure. 2. The value of a clean environment. 3. The value of all activity that takes place outside of markets. |
