Eco/101 Essay

687 Words Apr 28th, 2013 3 Pages
Economics 101
Alicia Fletcher
April 29, 2013
Shah Danyal

Economics 101

The gross domestic product is the output of goods and services provided by labor and property located in the US. The measurement is used to determine the growth of the economy and can determine what areas may need a boost in their output to help the economy grow. An inflation-adjusted measure that reflects the value of all goods and services produced in a given year, expressed in base-year prices. Often referred to as "constant-price," "inflation-corrected" GDP or "constant dollar GDP". Real GDP is the nominal GDP plus adjustment for inflation. Real GDP is also called per capita real output which is where the total population divides the real GDP.
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The household affect is due to the lack of income coming into the household due to the layoff. The affect on the businesses is a two fold. The reason for the layoffs could be due in part to lack of business causing the layoffs. Layoffs sometimes are done for business reasons due to the fact that maybe the business has beefed up there staff due to the amount of work and now they are having to cut back or trim the fat of the company. This can help a business be more profitable due to cut in income expenses. The affect on the government would be the unemployment rate will increase and discourage those that are looking for jobs. There are more affects to the government as well such as less people paying taxes, spending money and laid off employees will be possibly cost the government money due to government programs. Decreasing taxes also affects the government, households and businesses. The way decreasing taxes would affect the household would be increasing the income going into the household. With the increase in income households would spend more money. With everyone spending more money it would help businesses increase their sales. The business would also profit more from not having to pay as much in taxes if taxes were to be decreased. Their would be a potential negative affect on the government. If they decreased the taxes there would be less funding coming into the government to pay for the

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