Chapter 2: National Income Accounting Difficulty: Easy 1. In calculating this year’s GDP‚ national income accountants A) include any increase in stock values B) include an estimate for income from illegal activities C) exclude Social Security payments to retirees D) exclude the value of any repairs made on existing property E) exclude the value of new pollution control equipment that is being installed Ans: C Difficulty: Medium 2. Assume you built a new house‚ bought a used
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in an economy is very important because it gives an estimation of the welfare of the economy. National income is the total of the value of the goods and the services which are produced in an economy. The basic measures of national income include GDP‚ GNP‚ GNI‚ NNP and NNI. There are three approaches through which national income can be calculated including; output approach‚ income approach and expenditure approach. All of these approaches give the same value of the national income. The method
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AND MEASUREMENT National Income: Concept and Measurement NOTES Structure 10.0 10.1 10.2 10.3 Introduction Unit Objectives Definition of National Income Measures of National Income 10.3.1 Gross National Product (GNP); 10.3.2 Gross Domestic Product (GDP); 10.3.3 Net National Product (NNP); 10.3.4 National Income: Some Accounting Relationships 10.4 Methods of Measuring National Income 10.4.1 Net Output or Value-Added Method; 10.4.2 Factor-Income Method; 10.4.3 Expenditure
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boundary in a year GDP = GNP – Net income earned from abroad 2.GROSS NATIONAL PRODUCT Defined as current value of all goods and services produced by the economy during a given period • GNP = value of all (final) goods and services produced in a country in one year + income earned by its citizens abroad - income earned by foreigners in the country 3.NET NATIONAL PRODUCT Net National Product (NNP) is arrived at by making some adjustment‚ with regard to depreciation‚ in GNP GNP – Depreciation = NNP
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STUDY GUIDE#2 for Macroeconomics TEST#2-Wednesday‚ March 5th ‘14 PS: TEST#2 will have 55 questions (including extra credit questions) for all students Study and know very well the following topics: Topic#1-Miscellaneous Topics (1)Study and know very well the ten (10) principles of economics and their categories (2)Study and know the definition of the central economic problem in societies (3)The definition of the Scientific method and its analytical tools (4)Study and know the definitions
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sectors of the economy. B) Compare the value of output of one period with that of another. C) Provide an index to measure the rate of inflation. D) All of the above. Answer: D Type: Basic Understanding Page: 93 3. The GDP is: A) C + I + G + (X - IM). B) The sum of value added at every stage of the production process. C) The total market value of final goods and services. D) All of the above. Answer: D Type: Definition Page: 93 4.
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1 INTRODUCTION Continuous rapid economic growth has raised Malaysia from an agricultural and commodity-based low-income economy to a successful middle-income economy. As a mixed economy‚ Malaysia has elements of a free market economy nevertheless with intervention government. Malaysia’s economic activity consist of a mixture of sectors whereas mixed of capitalism and socialism The strong economic performance has helped improve the quality of life for Malaysians and supported advances in education
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level of GDP‚ given a nation ’s production capacity? (2) What causes real GDP to rise in one period and to fall in another?" (McConnell & Brue‚ p.72). So how do economists measure the economy as a whole? What are the indicators and variables they measure? Where are the forecasts obtained? And what historical data do they use? The paper will list these indicators and variables‚ including the importance and types of historical data. The Economic Indicators Net domestic product (NDP) is the
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SAU LECTURE NOTE ON ECO 213 INTRODUCTION TO MACROECONOMICS I COURSE OUTLINE 1. Nature and scope of macroeconomics • Macroeconomics defined • Why study macroeconomic • Macroeconomic theories • Relationship and interdependency of microeconomics and macroeconomics • Drawbacks of macroeconomics 2. National income accounting • Definitions • Concepts associated with national income •
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conditions‚ but to many citizens the information is confusing or incomprehensible. This chapter acquaints students with the basic language of macroeconomics and national income accounting. GDP is defined and explained. Then‚ the differences between the expenditure and income approaches to determining GDP are discussed and analyzed in terms of their component parts. The income and expenditure approaches are developed gradually from the basic expenditure-income identity‚ through tables and figures
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