National Income Accounting
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National Income Accounting

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National Income Accounting

National Income Accounting

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National Income Accounting National Income Accounting Presentation Transcript

  • National-IncomeAccountingPrepared by:Akash gupta 188Dewang chauhan 203alankar das 190Pankaj chhokar 147shikha rai 1611
  • Measuring the Economy2
  • Measures of Output3
  • Gross Domestic Product (GDP)4
  • GDP Versus GNP5
  • GDP per Capita6
  • Measurement Problems7
  • Value Added8
  • Value Added9
  • Value Added in Various Stagesof Production10Stages of ProductionValue ofTransactionsValueAdded1.  Farmer grows wheat, sells it to miller $0.12 $0.122.  Miller converts wheat to flour, sells it to baker 0.28 0.163.  Baker bakes bagel, sells it to bagel store 0.60 0.324.  Bagel store sells bagel to consumer 0.75 0.15Total $1.75 $0.75
  • Two Ways to Calculate GDP11
  • Real Versus Nominal GDP12
  • Computing Real GDP13
  • Computing Real GDP14nominal GDP in yearReal GDP in yearprice indextt =100price index100percentage change+=
  • Net Domestic Product15
  • Net Domestic Product16–NDP GDP depreciation=
  • Net Domestic Product17
  • Net Domestic Product18
  • Net Domestic Product19
  • The Uses of Output20
  • Consumption21
  • Investment22
  • Government Spending23
  • Net Exports24
  • GDP Components25( )–GDP C I G X M= + + +
  • Measures of Income26
  • Output = Income27WagesProductmarketConsumer spendingInvestment spendingGovernment spendingNet exportsProfitsInterestRent
  • The Equivalence of Expenditure andIncome(In billions of dollars)28Expenditure IncomeC:Consumer goods andservicesWages and salaries $8,062$10,057 Corporate profits 1,092I:Investment in plant,equipment, andinventoryProprietors’ income 1,072Rents 641,994 Interest 929G:Government goodsand servicesTaxes on output and imports 1,0342,882 Depreciation 1,832X:Exports 1,859 Miscellaneous 46M:Imports (2,529) Statistical discrepancy 136GDP:Total value of output $14,265 = Total value of income $14,265
  • National Income29–NDP GDP depreciation=
  • Net Foreign Factor Income30
  • National Income31NI NDP net foreign factor income= +
  • Personal Income32PI NI indirect business taxes corporate profitsinterest and misc paymentsSocial Security taxestransfer payments capital income= − −−−+ +
  • Indirect Business Taxes33
  • Corporate Profits34
  • Payroll Taxes and Transfers35
  • Capital Income36
  • Disposable Income37–DI personal income personal taxes=
  • Disposable Income38DI consumption saving= +
  • The Flow of Income39
  • Income and Expenditure40
  • 41