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Macro economic: the data of macroeconomic (mankiw)


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This is the power point of Macroeconomic book by Mankiw 7th Edition. Chapter 2: The Data of Macroeconomic.

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Macro economic: the data of macroeconomic (mankiw)

  1. 1. Chapter 2: The Data of Macroeconomic Zumrotul Mahmudah 125040100111036 Agriculture Faculty of Brawijaya University
  2. 2. Part of this Chapter: 1.Measuring the value of Economic Activity: Gross Domestic Product (GDP). 2.Measuring The Cost of Living: The Consumer Price Index. 3.Measuring Joblessness: the Unemployment Rate 4.Conclusion: from Economic Statistics To Economic Models
  3. 3. Measuring the value of Economic Activity: Gross Domestic Product (GDP) GDP is the total income of everyone of the economy GDP is as the total expenditure on the economy’s output of goods and services
  4. 4. Income, Expenditure and Circular Flow
  5. 5. Stock and Flow stock is a quantity measured at a given point in time. flow is a quantity measured per unit of time.
  6. 6. Rules for Computing GDP Gross domestic product (GDP) is the market value of all final goods and services produced within an economy in a given period of time. GDP = (Price of goods or services × Quantity of goods or services) + (Price of goods or services × Quantity of goods or services)
  7. 7. Real GDP Vs Nominal GDP Value of money change = nominal GDP Quantity change = real GDP
  8. 8. GDP Deflator (measure of price) The GDP deflator, also called the implicit price deflator for GDP, is the ratio of nominal GDP to real GDP: = P x Q
  9. 9. The Components of Expenditure Consumption (C) Investment (I ) Government purchases (G) Net exports (NX) Letting Y stand for GDP Y = C + I + G + NX
  10. 10. GDP and the Components of Expenditure: 2007
  11. 11. Other Measures of Income Gross National Product(GNP), we add receipts of factor income (wages, profit, and rent) from the rest of the world and subtract payments of factor income to the rest of the world: Whereas GDP measures the total income produced domestically, GNP measures the total income earned by nationals (residents of a nation).
  12. 12. Other Measures of Income Net National Product(NNP), we subtract the depreciation of capital— the amount of the economy’s stock of plants, equipment, and residential structures that wears out during the year: In the national income accounts, depreciation is called the consumption of fixed capital. It equals about 10 percent of GNP. Because the depreciation of capital is a cost of producing the output of the economy, subtracting depreciation shows the net result of economic activity.
  13. 13. Measuring The Cost of Living: The Consumer Price Index The Price of a Basket of Goods: consumer price index (CPI). The CPI is the price of (this basket) of goods and services relative to the price of (the same basket) in some base year.
  14. 14. The CPI Versus the GDP Deflator GDP Deflator CPI the GDP deflator measures the prices of all goods and services produced. the CPI measures the prices of only the goods and services bought by consumers. the GDP deflator includes only those goods produced Domestically. The CPI includes not only those goods produced domestically, but also the import goods. the GDP deflator assigns changing weights. The CPI assigns fixed weights to the prices of different goods.
  15. 15. Measuring Joblessness: the unemployment Rate The Household Survey Employed Unemployed Not in the labor force 1 2 3
  16. 16. Count Three Group of the Population
  17. 17. The Establishment Survey The establishment survey, it obtains an estimate of the number of workers firms have on their payrolls. Example: A person who runs his or her own business is self-employed. The household survey counts that person as working, whereas the establishment survey does not, because that person does not show up on any firm’s payroll. As another example, a person who holds two jobs is counted as one employed person in the household survey but is counted twice in the establishment survey, because that person would show up on the payroll of two firms.
  18. 18. THANKYOU