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22 Cards in this Set
- Front
- Back
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The movement of goods and services from firms to households, and of resources from households to firms
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Circular flow of goods, services, and resources
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The movement of income in the form of resource payments from firms to households, and of income in the form of revenue from households to firms
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Circular flow of money
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A method of calculating GDP that adds all expenditures made for final goods and services by households, firms, and government
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Expenditure approach
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Goods purchased for final use, not for resale
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Final goods
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Goods used to produce other goods
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Intermediate goods
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The difference between the value of a good that a firm produces and the value of the goods the firm uses to produce it
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Value added
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All goods and services bought by households
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Personal consumption expenditures
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In purchases by firms of plant, equipment, and inventory goods
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Gross private domestic investment
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All goods and services bought by government
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Government purchases
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An economy's exports to other economies, minus its imports from other economies
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Net exports
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Goods expected to last at least a year
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Durable goods
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Goods expected to last less than a year
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Nondurable goods
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productive activities that are instantaneously consumed
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Services
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Stocks of finished goods and raw materials that firms keep in reserve to facilitate production and sales
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Inventory investment
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A method of calculating GDP that adds all the incomes earned in the production of final goods and services
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Income approach
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The sum of all payments made to resource owners for the use of their resources
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National income
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The market value of all final goods and services in an economy produced by resources owned by people of that economy, regardless of where the resources are located
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Gross national product (GNP)
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The value of existing capital stock used up in the process of producing goods and services
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Capital depreciation
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National income, plus income received but not earned, minus income earned but not received
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Personal income
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income received but not earned
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Transfer payement
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personal income minus direct taxes
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Disposable personal income
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The unreported or illegal production of goods and services in the economy that is not counted in GDP
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Underground economy
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