This document discusses key macroeconomic concepts and measurement including:
- GDP can be measured as the sum of value added by all producers, as the sum of income claims generated in production, or as the spending on final goods and services.
- GDP measures domestic production while GNI measures income earned by a country's residents, including income from overseas.
- Potential GDP is the level of output if the economy was at full employment, and the GDP gap is the difference between actual and potential GDP.
in this PPT government budget and its classification of budget is explained. menaing of budget, different type of budget deficits are also explained in it. you can also find on what basis revenue and capital receipt and expenditure are classified.
different type of budget deficits and their implications are also explained.
Fiscal policy involves a government adjusting its spending and tax rates to influence the economy. The objectives of fiscal policy include full employment, reducing inequality, price stability, and economic development. Public revenue comes from tax receipts like direct taxes on individuals/corporations and indirect taxes on goods/services. It also comes from non-tax receipts like interest. Public expenditure consists of revenue expenditure on current needs and capital expenditure on infrastructure. India's fiscal policy has shifted from indirect taxes to more direct taxes since independence. The 2017 budget aims to transform, energize and clean the economy through initiatives for farmers, MGNREGA, affordable housing, and promoting a digital India.
The circular flow of income model describes the reciprocal flow of money between households and firms. Households supply factors of production like labor to firms and receive income, while firms supply goods and services to households in exchange. This forms a continuous loop referred to as the circular flow of income, with payments in each direction. The model can be expanded to include government and foreign trade. It helps explain macroeconomic concepts like GDP, equilibrium, and the effects of policies.
The document discusses returns to scale in production. It defines returns to scale as the degree to which output changes with a change in all input factors. There are three types of returns to scale: constant, where a change in inputs leads to a proportional change in output; increasing, where more output is generated than the input change; and decreasing, where less output results than the input change. The document provides examples of each type of returns to scale and notes the assumptions needed for the law of returns to scale to apply, such as all inputs being variable and technology remaining constant.
Trends in public and private sector in indiaAshutosh Gupta
The document discusses trends in India's public and private sectors. It provides an overview of the growth and objectives of public sector enterprises since India's first five-year plan in the 1950s. It also outlines the growth and increasing role of private sector companies in India since the 1950s. The document compares the public and private sectors in terms of their share of gross domestic savings, capital formation, employment and GDP. It notes some defects of both sectors that led to reforms.
Role of Direct Tax Towards Development Of Indian EconomySundar B N
The document discusses various types of taxes imposed in India including income tax, corporate tax, and indirect taxes. It provides income tax slabs for individuals and HUFs as well as annual income tax regimes. For corporate tax, it notes the rates for domestic and foreign companies based on turnover. Taxes are a key source of government revenue and are used to fund public expenditures and infrastructure development.
in this PPT government budget and its classification of budget is explained. menaing of budget, different type of budget deficits are also explained in it. you can also find on what basis revenue and capital receipt and expenditure are classified.
different type of budget deficits and their implications are also explained.
Fiscal policy involves a government adjusting its spending and tax rates to influence the economy. The objectives of fiscal policy include full employment, reducing inequality, price stability, and economic development. Public revenue comes from tax receipts like direct taxes on individuals/corporations and indirect taxes on goods/services. It also comes from non-tax receipts like interest. Public expenditure consists of revenue expenditure on current needs and capital expenditure on infrastructure. India's fiscal policy has shifted from indirect taxes to more direct taxes since independence. The 2017 budget aims to transform, energize and clean the economy through initiatives for farmers, MGNREGA, affordable housing, and promoting a digital India.
The circular flow of income model describes the reciprocal flow of money between households and firms. Households supply factors of production like labor to firms and receive income, while firms supply goods and services to households in exchange. This forms a continuous loop referred to as the circular flow of income, with payments in each direction. The model can be expanded to include government and foreign trade. It helps explain macroeconomic concepts like GDP, equilibrium, and the effects of policies.
The document discusses returns to scale in production. It defines returns to scale as the degree to which output changes with a change in all input factors. There are three types of returns to scale: constant, where a change in inputs leads to a proportional change in output; increasing, where more output is generated than the input change; and decreasing, where less output results than the input change. The document provides examples of each type of returns to scale and notes the assumptions needed for the law of returns to scale to apply, such as all inputs being variable and technology remaining constant.
Trends in public and private sector in indiaAshutosh Gupta
The document discusses trends in India's public and private sectors. It provides an overview of the growth and objectives of public sector enterprises since India's first five-year plan in the 1950s. It also outlines the growth and increasing role of private sector companies in India since the 1950s. The document compares the public and private sectors in terms of their share of gross domestic savings, capital formation, employment and GDP. It notes some defects of both sectors that led to reforms.
Role of Direct Tax Towards Development Of Indian EconomySundar B N
The document discusses various types of taxes imposed in India including income tax, corporate tax, and indirect taxes. It provides income tax slabs for individuals and HUFs as well as annual income tax regimes. For corporate tax, it notes the rates for domestic and foreign companies based on turnover. Taxes are a key source of government revenue and are used to fund public expenditures and infrastructure development.
This document discusses fiscal policy and public finance. It defines fiscal policy as the policy through which governments create and sustain public economies. The major functions of fiscal policy are outlined as allocation of resources, distribution of income and wealth, and economic stabilization. Key topics covered include government revenue sources, features of a good tax policy, approaches to tax equity, and the concept of tax incidence.
1) National income of India constitutes the total amount of income earned by the whole nation and originated both within and outside its territory during a particular year.
2) Estimates of national income are made using various methods including output, income, and expenditure. Data is provided by government agencies and surveys.
3) India's national income has grown significantly since independence, with the economy experiencing periods of modest growth, recovery, and higher growth during the post-reform period from 1992 onward.
The document discusses the Keynesian multiplier theory and the concept of the multiplier. It explains that the multiplier is a ratio that shows the total change in income resulting from an initial change in investment. A higher marginal propensity to consume (MPC) leads to a higher multiplier value. The document also introduces the supermultiplier concept developed by John Maynard Keynes, which accounts for induced investment in addition to induced consumption. It provides an example of how the supermultiplier process works over multiple periods.
National income is measured using three main methods: the production method, income method, and expenditure method. It is the total value of all final goods and services produced in an economy in a given period. National income data is important for measuring economic growth, distribution of wealth, and government budgeting and planning. However, there are difficulties in measuring national income such as the large non-monetized sector in many developing countries, unwillingness of people to reveal income data, problems with data collection, calculating depreciation, and avoiding double counting.
policy implication of the classical Equilibrium modelShahidMunir33
The document discusses the effects of reducing income taxes according to the classical equilibrium model. It states that reducing income taxes would:
1) Increase disposable income, leading to higher consumption and aggregate demand. Interest rates may also increase as the government issues bonds to replace lost revenue.
2) Increase the real wages of individuals by reducing the percentage of income paid in taxes. This would shift the aggregate labor supply curve to the right, increasing employment and overall output.
3) Shift the aggregate supply curve to the right as well, which would decrease price levels according to the new general equilibrium of the model.
The Fiscal Responsibility and Budget Management (FRBM) Act was enacted in 2003 to bring fiscal discipline to India's budget and reduce deficits. The Act aimed to eliminate revenue deficit and lower fiscal deficit to 3% of GDP by 2008 through limits on fiscal and revenue deficits. While some targets were met briefly, international crises caused the deadlines to be suspended. The FRBM Act requires regular reporting to Parliament on the country's fiscal policy and macroeconomic indicators to improve management of public funds.
Deficit financing is when a government finances its budgetary deficit through borrowing or increasing the money supply. In India it refers to expenditures exceeding current revenues, with public borrowing to cover the difference. The main types of deficits are the budget, revenue, fiscal, and primary deficits. Fiscal deficits in India have increased substantially over time, from 23 billion rupees in 1974-75 to over 5 trillion rupees in 2012-13. Deficit financing can be used to remedy economic issues but comes with adverse effects like inflation, reduced savings and investment, and higher production costs.
The document discusses fiscal federalism in India. It defines fiscal federalism and explains its importance in India by enabling collaboration between central and state governments. It outlines the evolution of fiscal federalism in India from the pre-independence era of centralized British rule to the post-independence constitution establishing a federal system. It describes types of fiscal imbalances in India and central government transfers to states, including statutory transfers mandated by law and discretionary transfers for specific programs. It discusses performance-based grants and the 2017 M. Govinda Rao report recommending rationalizing transfers and introducing such grants. Finally, it outlines the terms of reference for India's 15th Finance Commission report on fiscal transfers from 2020-2025.
This document provides information on national income in India and its estimation methodology. It discusses that national income refers to the total value of all goods and services produced in a country in a year. It then describes the two methods used to estimate India's national income - the product method and income method. It also provides details on India's economic growth performance during each of its Five Year Plans since the first plan in 1951, including the growth rates achieved for national income and per capita income.
Public debt in India has increased over 7 times from 1990-1991 to 2005-2006. It includes money borrowed by the government through internal loans within India and external loans from international organizations. There are several types of public debt like short-term, long-term, productive and unproductive debts. While public debt allows the government to fund development projects, it also burdens citizens with increased taxes and can adversely affect growth. Proper management of public debt is needed in India through reducing expenditures, encouraging foreign investment, and monitoring public spending.
It includes:
CLASSICAL THEORY OF EMPLOYMENT,
SAY’S LAW OF MARKET,
Determination of Employment and Output in the Classical Model,
Keynesian Theory of Employment,
Principle of Effective Demand, and on many more topics...
The document discusses the circular flow of income in macroeconomics. It explains that the circular flow shows how households and firms interact in an economy through the flows of goods, services and money between them. It presents the circular flow model for closed economies without and with savings, as well as for open economies consisting of households, firms, government and foreign sectors. The circular flow of income model is useful for understanding the macroeconomy and guiding fiscal and monetary policy to maintain equilibrium.
In Macroeconomics Income and Employment are interchangeable terms, since in the short-run National income depends on the total volume of employment or economic activity in the country. As income and employment are synonymous the employment theory is also called income theory.
It should be clear to readers that the classical economists did not formulate any specific theory of employment as such. They only laid down certain postulates which subsequently developed as a theory.
Trade cycles refer to the rise and fall in the level of economic activity over time. They typically involve four phases: depression, recovery, boom, and recession. Trade cycles are caused by factors such as changes in climate, technology, government policy, and business optimism/pessimism. The rise and fall can be amplified by monetary factors like changes in the money supply or demand for money. Governments try to control business cycles through expansionary fiscal and monetary policies during recessions to stimulate aggregate demand, and price/wage controls to stabilize the economy.
The Philip curve shows an inverse relationship between the rate of unemployment and the rate of change in money wages in the short run. Friedman argued that in the long run, there is no tradeoff between inflation and unemployment - the Philip curve becomes vertical at the natural rate of unemployment, which is the rate where expected and actual inflation are equal. Temporary reductions in unemployment below the natural rate are only possible if inflation rises above expectations, but eventually expectations will adjust and unemployment will return to the natural rate, even as inflation accelerates.
The document discusses fiscal deficit, which is defined as the excess of total government expenditure over total receipts, excluding borrowings. It lists some key causes of fiscal deficit such as excessive government borrowing, tax avoidance, inequality, and subsidies. It also discusses how deficits are met through borrowing and deficit financing, and provides India's current fiscal position with a deficit of Rs. 4.11 trillion until October 2016. The consequences of high deficits are listed as debt traps, inflation, foreign dependence, and reduced social spending. Measures to reduce deficits mentioned include disinvestment, tax reforms, expenditure cuts, and curbing black money.
Gross Domestic Product, or GDP, is a measurement of the total market value of all final goods and services produced within a country in a given period of time, usually a year. GDP is used to indicate the overall economic performance and health of a nation's economy. It excludes production that occurs abroad and only includes "new" domestic production, not used goods. GDP has limitations as it does not account for non-market activities, distribution of goods, leisure time, or negative externalities like pollution.
Presentation on Sources Of Revenue For GovernmentShubham Saraf
The government collects revenue from various tax and non-tax sources. Tax revenue includes items like income tax of Rs. 1,72,026 crores, corporation tax of Rs. 359,990 crores, and service tax of Rs. 82,000 crores. Non-tax revenue consists of items such as interest receipts, dividends, grants, and income from public enterprises totaling Rs. 125,435 crores. Capital receipts include borrowings, recoveries of loans, and small savings deposits totaling over Rs. 500,000 crores in 2011-12.
National income measures the total value of goods and services produced in an economy over a period of time. It is important for economists to measure national income to analyze economic growth, living standards, and income inequality. There are several concepts for calculating national income, including gross domestic product (GDP), gross national product (GNP), personal income, and per capita income. National income can be measured using the product, income, and expenditure methods, each with their own steps and considerations to account for issues like double counting. Calculating national income precisely poses challenges but the statistics are useful for economic planning, analysis, and international comparisons.
The document discusses several key concepts in national income accounting:
1) GDP and GNP measure the aggregate output of final goods and services in an economy or produced domestically after accounting for international transactions.
2) Value added method avoids double counting by adding the value contributed at each stage of production.
3) Goods and services are evaluated at market prices to aggregate different types of output.
4) Stock variables measure levels at a point in time, while flow variables measure changes over a period of time like GDP.
This document provides an introduction to key concepts in tourism economics. It discusses standardized economic measures such as GDP, FDI, and balance of payments. It also explores economic trends including recession, inflation, and standards of living. Finally, it defines GDP and how it is calculated using the production, income, and expenditure approaches. It provides examples of how GDP, FDI, and balance of payments are determined.
This document discusses fiscal policy and public finance. It defines fiscal policy as the policy through which governments create and sustain public economies. The major functions of fiscal policy are outlined as allocation of resources, distribution of income and wealth, and economic stabilization. Key topics covered include government revenue sources, features of a good tax policy, approaches to tax equity, and the concept of tax incidence.
1) National income of India constitutes the total amount of income earned by the whole nation and originated both within and outside its territory during a particular year.
2) Estimates of national income are made using various methods including output, income, and expenditure. Data is provided by government agencies and surveys.
3) India's national income has grown significantly since independence, with the economy experiencing periods of modest growth, recovery, and higher growth during the post-reform period from 1992 onward.
The document discusses the Keynesian multiplier theory and the concept of the multiplier. It explains that the multiplier is a ratio that shows the total change in income resulting from an initial change in investment. A higher marginal propensity to consume (MPC) leads to a higher multiplier value. The document also introduces the supermultiplier concept developed by John Maynard Keynes, which accounts for induced investment in addition to induced consumption. It provides an example of how the supermultiplier process works over multiple periods.
National income is measured using three main methods: the production method, income method, and expenditure method. It is the total value of all final goods and services produced in an economy in a given period. National income data is important for measuring economic growth, distribution of wealth, and government budgeting and planning. However, there are difficulties in measuring national income such as the large non-monetized sector in many developing countries, unwillingness of people to reveal income data, problems with data collection, calculating depreciation, and avoiding double counting.
policy implication of the classical Equilibrium modelShahidMunir33
The document discusses the effects of reducing income taxes according to the classical equilibrium model. It states that reducing income taxes would:
1) Increase disposable income, leading to higher consumption and aggregate demand. Interest rates may also increase as the government issues bonds to replace lost revenue.
2) Increase the real wages of individuals by reducing the percentage of income paid in taxes. This would shift the aggregate labor supply curve to the right, increasing employment and overall output.
3) Shift the aggregate supply curve to the right as well, which would decrease price levels according to the new general equilibrium of the model.
The Fiscal Responsibility and Budget Management (FRBM) Act was enacted in 2003 to bring fiscal discipline to India's budget and reduce deficits. The Act aimed to eliminate revenue deficit and lower fiscal deficit to 3% of GDP by 2008 through limits on fiscal and revenue deficits. While some targets were met briefly, international crises caused the deadlines to be suspended. The FRBM Act requires regular reporting to Parliament on the country's fiscal policy and macroeconomic indicators to improve management of public funds.
Deficit financing is when a government finances its budgetary deficit through borrowing or increasing the money supply. In India it refers to expenditures exceeding current revenues, with public borrowing to cover the difference. The main types of deficits are the budget, revenue, fiscal, and primary deficits. Fiscal deficits in India have increased substantially over time, from 23 billion rupees in 1974-75 to over 5 trillion rupees in 2012-13. Deficit financing can be used to remedy economic issues but comes with adverse effects like inflation, reduced savings and investment, and higher production costs.
The document discusses fiscal federalism in India. It defines fiscal federalism and explains its importance in India by enabling collaboration between central and state governments. It outlines the evolution of fiscal federalism in India from the pre-independence era of centralized British rule to the post-independence constitution establishing a federal system. It describes types of fiscal imbalances in India and central government transfers to states, including statutory transfers mandated by law and discretionary transfers for specific programs. It discusses performance-based grants and the 2017 M. Govinda Rao report recommending rationalizing transfers and introducing such grants. Finally, it outlines the terms of reference for India's 15th Finance Commission report on fiscal transfers from 2020-2025.
This document provides information on national income in India and its estimation methodology. It discusses that national income refers to the total value of all goods and services produced in a country in a year. It then describes the two methods used to estimate India's national income - the product method and income method. It also provides details on India's economic growth performance during each of its Five Year Plans since the first plan in 1951, including the growth rates achieved for national income and per capita income.
Public debt in India has increased over 7 times from 1990-1991 to 2005-2006. It includes money borrowed by the government through internal loans within India and external loans from international organizations. There are several types of public debt like short-term, long-term, productive and unproductive debts. While public debt allows the government to fund development projects, it also burdens citizens with increased taxes and can adversely affect growth. Proper management of public debt is needed in India through reducing expenditures, encouraging foreign investment, and monitoring public spending.
It includes:
CLASSICAL THEORY OF EMPLOYMENT,
SAY’S LAW OF MARKET,
Determination of Employment and Output in the Classical Model,
Keynesian Theory of Employment,
Principle of Effective Demand, and on many more topics...
The document discusses the circular flow of income in macroeconomics. It explains that the circular flow shows how households and firms interact in an economy through the flows of goods, services and money between them. It presents the circular flow model for closed economies without and with savings, as well as for open economies consisting of households, firms, government and foreign sectors. The circular flow of income model is useful for understanding the macroeconomy and guiding fiscal and monetary policy to maintain equilibrium.
In Macroeconomics Income and Employment are interchangeable terms, since in the short-run National income depends on the total volume of employment or economic activity in the country. As income and employment are synonymous the employment theory is also called income theory.
It should be clear to readers that the classical economists did not formulate any specific theory of employment as such. They only laid down certain postulates which subsequently developed as a theory.
Trade cycles refer to the rise and fall in the level of economic activity over time. They typically involve four phases: depression, recovery, boom, and recession. Trade cycles are caused by factors such as changes in climate, technology, government policy, and business optimism/pessimism. The rise and fall can be amplified by monetary factors like changes in the money supply or demand for money. Governments try to control business cycles through expansionary fiscal and monetary policies during recessions to stimulate aggregate demand, and price/wage controls to stabilize the economy.
The Philip curve shows an inverse relationship between the rate of unemployment and the rate of change in money wages in the short run. Friedman argued that in the long run, there is no tradeoff between inflation and unemployment - the Philip curve becomes vertical at the natural rate of unemployment, which is the rate where expected and actual inflation are equal. Temporary reductions in unemployment below the natural rate are only possible if inflation rises above expectations, but eventually expectations will adjust and unemployment will return to the natural rate, even as inflation accelerates.
The document discusses fiscal deficit, which is defined as the excess of total government expenditure over total receipts, excluding borrowings. It lists some key causes of fiscal deficit such as excessive government borrowing, tax avoidance, inequality, and subsidies. It also discusses how deficits are met through borrowing and deficit financing, and provides India's current fiscal position with a deficit of Rs. 4.11 trillion until October 2016. The consequences of high deficits are listed as debt traps, inflation, foreign dependence, and reduced social spending. Measures to reduce deficits mentioned include disinvestment, tax reforms, expenditure cuts, and curbing black money.
Gross Domestic Product, or GDP, is a measurement of the total market value of all final goods and services produced within a country in a given period of time, usually a year. GDP is used to indicate the overall economic performance and health of a nation's economy. It excludes production that occurs abroad and only includes "new" domestic production, not used goods. GDP has limitations as it does not account for non-market activities, distribution of goods, leisure time, or negative externalities like pollution.
Presentation on Sources Of Revenue For GovernmentShubham Saraf
The government collects revenue from various tax and non-tax sources. Tax revenue includes items like income tax of Rs. 1,72,026 crores, corporation tax of Rs. 359,990 crores, and service tax of Rs. 82,000 crores. Non-tax revenue consists of items such as interest receipts, dividends, grants, and income from public enterprises totaling Rs. 125,435 crores. Capital receipts include borrowings, recoveries of loans, and small savings deposits totaling over Rs. 500,000 crores in 2011-12.
National income measures the total value of goods and services produced in an economy over a period of time. It is important for economists to measure national income to analyze economic growth, living standards, and income inequality. There are several concepts for calculating national income, including gross domestic product (GDP), gross national product (GNP), personal income, and per capita income. National income can be measured using the product, income, and expenditure methods, each with their own steps and considerations to account for issues like double counting. Calculating national income precisely poses challenges but the statistics are useful for economic planning, analysis, and international comparisons.
The document discusses several key concepts in national income accounting:
1) GDP and GNP measure the aggregate output of final goods and services in an economy or produced domestically after accounting for international transactions.
2) Value added method avoids double counting by adding the value contributed at each stage of production.
3) Goods and services are evaluated at market prices to aggregate different types of output.
4) Stock variables measure levels at a point in time, while flow variables measure changes over a period of time like GDP.
This document provides an introduction to key concepts in tourism economics. It discusses standardized economic measures such as GDP, FDI, and balance of payments. It also explores economic trends including recession, inflation, and standards of living. Finally, it defines GDP and how it is calculated using the production, income, and expenditure approaches. It provides examples of how GDP, FDI, and balance of payments are determined.
Measurement of National Income-concepts simplifiedmanuelmathew1
2 only
Human capital formation refers to the process of acquiring and increasing the number of persons who have the skills, education, experience and access to health care needed to be productive. It is better explained as increasing the knowledge, skill levels and capacities of people as given in statement 2.
GDP can be measured in three ways:
1) Expenditure approach measures total expenditures on final goods and services.
2) Income approach measures total income earned from production, including compensation, profits, and rents.
3) Production approach measures total value added at each stage of production.
Real GDP is used to measure economic growth by adjusting for inflation using GDP deflators or price indexes. However, GDP has limitations as a welfare measure since it excludes nonmarket activities and environmental factors.
This document defines GDP and its components. GDP is equal to the total expenditures for all final goods and services produced within a country in a year. It is also equal to the sum of value added at each production stage by all industries, plus taxes and minus subsidies. GDP is calculated using the expenditure method as the sum of consumption, investment, government spending, and net exports. The components of GDP - consumption, investment, government spending, exports and imports - are also defined.
National income accounting measures aggregate economic activity, including GDP and its components. GDP is the total market value of final goods and services produced within a nation's borders in a given time period. GDP can be calculated by totaling expenditures on consumption, investment, government spending, and net exports. Alternatively, GDP can be viewed through the income approach by totaling wages, profits, interest, rent, and subtracting factors like depreciation and taxes to arrive at measures like national income and disposable personal income.
The document discusses key concepts related to measuring national income, including:
1) Gross National Product (GNP) is the total value of all final goods and services produced by a nation's resources in a year, including income earned abroad.
2) Gross Domestic Product (GDP) measures production within a nation's borders, regardless of ownership, and excludes income earned abroad.
3) National income statistics are used for economic planning, reviewing changes in living standards over time, comparing economic performance between countries, and appraising economic growth.
I do not have enough information to determine the category of military expenditure or present two situations where GDP=GDE based on the given document. The document provides an overview of macroeconomics concepts like GDP, GNP, national income accounting, business cycles, inflationary and recessionary gaps, but it does not specify details about military expenditure categories or conditions for GDP=GDE.
This document discusses key macroeconomic measures used by governments, including GDP, GNP, NNP, NDP, and factors that influence comparing economic growth between countries. It also covers the circular flow of income, aggregate expenditure, consumption and investment functions, and differences between the Keynesian and monetarist approaches to macroeconomics.
national income ,GNP, GDP, NOMINAL AND REAL INTEREST RATES& PPP'SVineeth Poliyath
National income refers to the total money value of all final goods and services produced within a country in a given year. It is used to measure the overall economic activity and standard of living in a country. GDP is a key measure of national income and is defined as the total market value of all final goods and services produced within a country in a given period of time. GDP can be calculated using the expenditure approach, income approach, or output approach and includes consumption, investment, government spending, and net exports. While GDP is a useful measure, it does not account for all factors that affect economic well-being such as leisure, environmental quality, and non-market activities.
Najmi Hassan's presentation covers key concepts about GDP including:
1. GDP is the total monetary value of all finished goods and services produced within a country's borders in a given time period, and is a measure of the size of the economy.
2. There are two types of GDP - nominal GDP which uses current prices, and real GDP which is inflation-adjusted.
3. GDP is calculated using either the expenditure approach which sums consumption, government spending, investment, and net exports, or the income approach which sums wages, profits, interest, and rent.
4. The GDP price deflator measures inflation by comparing nominal GDP to real GDP.
Here are the sources of data for GDP components:
- Consumption data comes from the Census Bureau's Retail Trade Survey, Survey of Manufacturers, and Service Survey which collect data from samples of retail firms, manufacturers, and service businesses.
- Investment data comes from the Census Bureau's surveys of construction industries and capital goods producers.
- Government purchase data is obtained from federal, state and local government accounts.
- Net export information comes from Customs Bureau trade statistics on imports and exports.
This document discusses different methods for measuring GDP and GNP, including national income accounting. It describes the income method, expenditure method, and production/value added method. The income method measures GDP by totaling factor incomes like wages, rents, profits. The expenditure method measures GDP as the total final expenditures on goods and services by consumers, investors, the government, and net exports. The production method avoids double counting by only including the value added at each stage of production.
This document discusses how GDP and economic growth are measured. It defines GDP as the total market value of final goods and services produced within a country in a given period of time. GDP is measured using both the expenditure approach, which sums consumption, investment, government spending, and net exports, and the income approach, which sums compensation to workers, corporate profits, proprietor's income, rents, and indirect taxes. Real GDP is used to calculate the economic growth rate by accounting for inflation. However, real GDP is not a perfect measure of economic welfare as it does not capture all factors that influence well-being.
The document discusses various methods for calculating GDP, including the income, expenditure, and output approaches. It notes that all approaches should yield the same result according to the circular flow model. It also discusses related concepts like GNP, national income, personal income, disposable income, real GDP, GDP deflator, and purchasing power parity which are used to adjust GDP comparisons.
BUSI 223Exercise 6 Instructions1. How much life insurance do y.docxRAHUL126667
BUSI 223
Exercise 6 Instructions
1. How much life insurance do you need? Using the Life Insurance Calculator, enter the information and post your results in the textbox section of the assignment link. You do NOT need to get actual quotes, just see how much you need.
2. Decide which health care plan you would choose. Looking at eHealth Insurance, enter your information (or you can make up information), and then pick 3 companies to compare. Again, you do not need to input personal information. You must only fill in the gender, birth date, tobacco use, college student, and zip code information. Copy and paste the results of the 3 companies that you compared into a Microsoft Word document and attach it in the Module/Week 6 assignment link. Choose the 1 plan that you would suggest and explain why you chose that particular plan.
Submit this assignment by 11:59 p.m. (ET) on Monday of Module/Week 6.
Lecture 2
Chapter 7
Measuring Domestic Output and National Income
Assessing the Economy’s Performance
National income accounting measures economy’s overall performance
Bureau of Economic Analysis compiles National Income and Product Accounts
Assess health of economy
Track long-run course
Formulate policy
National income accounting does for the economy what private accounting would do for an individual household or business. The Bureau of Economic Analysis, an agency of the Department of Commerce, compiles the data and reports it in National Income and Product Accounts. This information is used by economists and policymakers in formulating decisions for the best interest of the nation.
Gross Domestic Product(GDP)
GDP is the dollar value of all final goods and services produced within the borders of a country during a specific period of time.
Measure of aggregate output
Monetary measure
Avoid multiple counting
One way to avoid multiple counting is to include market value of final goods and ignore intermediate goods
Another approach is to count value added
The primary measure of the economy’s performance as a whole is its aggregate output. This is most commonly calculated as Gross Domestic Product, or GDP. GDP is a monetary measure in that everything is valued in dollars. All goods and services produced must be converted into dollar values for GDP to work. To avoid multiple counting of goods, GDP includes only the market value of final goods and ignores intermediate goods, which are goods either purchased for resale or for further processing into final goods. GDP could also avoid multiple counting by counting only the value added at each stage. Value added is the market value of a firm’s output less the value of the inputs that the firm purchased from others.
Intermediate goods are products that are purchased for resale or further processing or manufacturing. Final goods are products that are purchased by their end users.e.g Lettuce, carrots and vinegar in restaurant salads are intermediate goods, restaurant salads are final goods.
Monetary Measu ...
Measuring of national output and national incomeHarold Buco
This document outlines key concepts for measuring national output and income, including:
Gross Domestic Product (GDP) is the total market value of final goods and services produced domestically in a given period. GDP can be calculated using the expenditure approach (personal consumption + investment + government spending + net exports) or the income approach (compensation of employees + business income). Real GDP adjusts nominal GDP for inflation using a price index. While GDP measures market output, it does not account for non-market activities or income distribution, and other factors like leisure time or crime rates are not included.
National Income Statistics-by kekeli.pptxssuser569157
This document discusses three key measures of national income: gross domestic product (GDP), gross national income (GNI), and net national income (NNI). GDP measures the total value of goods and services produced within a country's borders. GNI is GDP plus net income from abroad. NNI is GNI minus depreciation of fixed assets. The document also outlines different methods for calculating GDP, including the output, income, and expenditure approaches, and defines related terms like exports, imports, and the GDP deflator.
The document discusses key concepts related to national income accounting in India. It provides the following information:
- India's GDP by sector is 55.2% services, 26.3% industry, and 18.5% agriculture, though agriculture employs 52% of workers.
- GDP can be calculated via the income approach (factor incomes), expenditure approach (consumption, investment, etc.), and output approach.
- National income accounts for incomes earned by citizens and is equal to GNP. It is calculated by making adjustments to GDP like adding net foreign income and subtracting depreciation.
- Other economic indicators discussed include GNP, personal income, disposable income, real GDP, purchasing power parity
Similar to Macroeconomic issues and measurement (20)
The document discusses various techniques for idea generation and innovation including concept posters, creative matrices, affinity clustering, and importance-difficulty matrices. It provides descriptions and step-by-step instructions for implementing each technique. The overall purpose is to provide teams with structured processes and tools to help generate and organize ideas in order to spur innovation.
This document discusses business model innovation and describes how companies like Nespresso and GE have successfully innovated their business models. It introduces concepts like the business model canvas and lean startup methodology. Nespresso is used as a case study of a company that achieved success by changing its business model from an original model focused on machine sales to a revised model centered around high-margin pod sales through a subscription-based club. GE is highlighted for its use of an ambidextrous strategy including its FastWorks innovation program to drive business model innovation and growth.
The document discusses design thinking and human-centered design. It emphasizes starting with understanding people by conducting interviews and observations to develop empathy. Interviewing techniques are described such as asking open-ended questions, digging deeper, and identifying extreme users to interview. The document also discusses developing customer journey maps to understand the emotional experience of customers, and creating personas to represent key groups of users. The overall message is that design thinking focuses on developing solutions that meet people's needs by understanding them first through various research methods.
This document provides an overview of an innovation and design thinking course. It outlines the course learning goals which are to enable students to recognize changing business landscapes, understand design thinking philosophy, and equip students with design thinking tools and frameworks. It also lists the intended learning outcomes which are recognizing limitations of traditional thinking, formulating innovative solutions, developing empathy, and recognizing an entrepreneurial mindset. The course evaluation includes a mid-term exam, design thinking project, and end-term exam. It then introduces the course facilitator and provides testimonials praising his expertise in innovation and design thinking workshops.
The document discusses several design thinking tools and techniques for framing problems, including statement starters, abstraction laddering, and stakeholder mapping. Statement starters involve reframing problem statements as questions to invite broader exploration. Abstraction laddering is a technique to reconsider problem statements by broadening or narrowing the focus through asking "why" or "how" questions. Stakeholder mapping diagrams the network of people with a stake in the system to guide research and build understanding.
The automotive brand saw significant growth in sales and revenue but only a slight increase in employees. To support this growth and equip employees to be more efficient and effective, they partnered with GP Strategies to develop new onboarding resources and training. GP Strategies designed blended learning content like eLearning, videos, and interactive job aids to help new employees get up to speed more quickly in their roles. The quick-start guides developed by GP Strategies helped reduce the time needed for managers to onboard new employees by up to 40%. Both learners and managers provided positive feedback that the new resources improved understanding of roles and operations.
The document summarizes a leadership development program called Developing Leaders (DL) established by Havas Health & You, a global communications group, in partnership with BlessingWhite. The goals of the DL program were to enhance leadership skills, establish supportive relationships, provide executive exposure and connections, and create an environment where leaders pay forward their learning to support future talent. The program involved identifying high-potential leaders, providing coaching, mentorship, workshops and assessments over multiple years. Surveys found the program improved leadership skills and confidence for most participants and positively impacted their teams.
1. The document discusses aggregate demand, aggregate supply, and macroeconomic equilibrium in the short run. It explains how shifts in aggregate demand and aggregate supply curves affect equilibrium GDP and price levels.
2. A change in the price level shifts the aggregate expenditure curve, changing equilibrium GDP as shown by movements along the aggregate demand curve.
3. The intersection of the aggregate demand and short-run aggregate supply curves determines the equilibrium levels of GDP and price. Shifts in these curves change the equilibrium values.
The document discusses GDP in an open economy with government. It covers how government spending, taxes, and the budget surplus/deficit affect aggregate demand. A budget surplus occurs when tax revenues exceed spending, while a deficit is when spending exceeds revenues. The net export function is negatively sloped, as imports increase with national income. Equilibrium GDP occurs when aggregate demand equals output. The size of the multiplier is affected by tax rates and import propensities. An increase in government spending shifts the aggregate demand curve up, increasing equilibrium GDP.
2 determination of gdp in the short runLakshayyadav5
This document provides an overview of a basic macroeconomic model for determining GDP in the short-run. It explains that GDP is determined by aggregate expenditure, which includes consumption, investment, government spending, and net exports. Consumption depends on disposable income and wealth, while investment depends on interest rates and business confidence. Equilibrium GDP occurs when aggregate expenditure equals total output.
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How to Manage Your Lost Opportunities in Odoo 17 CRMCeline George
Odoo 17 CRM allows us to track why we lose sales opportunities with "Lost Reasons." This helps analyze our sales process and identify areas for improvement. Here's how to configure lost reasons in Odoo 17 CRM
Macroeconomics- Movie Location
This will be used as part of your Personal Professional Portfolio once graded.
Objective:
Prepare a presentation or a paper using research, basic comparative analysis, data organization and application of economic information. You will make an informed assessment of an economic climate outside of the United States to accomplish an entertainment industry objective.
Assessment and Planning in Educational technology.pptxKavitha Krishnan
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This presentation was provided by Steph Pollock of The American Psychological Association’s Journals Program, and Damita Snow, of The American Society of Civil Engineers (ASCE), for the initial session of NISO's 2024 Training Series "DEIA in the Scholarly Landscape." Session One: 'Setting Expectations: a DEIA Primer,' was held June 6, 2024.
A Strategic Approach: GenAI in EducationPeter Windle
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This Gasta posits a strategic approach to integrating AI into HEIs to prepare staff, students and the curriculum for an evolving world and workplace. We will highlight the advantages of working with these technologies beyond the realm of teaching, learning and assessment by considering prompt engineering skills, industry impact, curriculum changes, and the need for staff upskilling. In contrast, not engaging strategically with Generative AI poses risks, including falling behind peers, missed opportunities and failing to ensure our graduates remain employable. The rapid evolution of AI technologies necessitates a proactive and strategic approach if we are to remain relevant.
This slide is special for master students (MIBS & MIFB) in UUM. Also useful for readers who are interested in the topic of contemporary Islamic banking.
A review of the growth of the Israel Genealogy Research Association Database Collection for the last 12 months. Our collection is now passed the 3 million mark and still growing. See which archives have contributed the most. See the different types of records we have, and which years have had records added. You can also see what we have for the future.
Physiology and chemistry of skin and pigmentation, hairs, scalp, lips and nail, Cleansing cream, Lotions, Face powders, Face packs, Lipsticks, Bath products, soaps and baby product,
Preparation and standardization of the following : Tonic, Bleaches, Dentifrices and Mouth washes & Tooth Pastes, Cosmetics for Nails.
2. Learning Outcomes
Macroeconomics looks at the economy as a whole,
dealing with such aggregate phenomena as growth
in total output and living standards, commonly
called ‘economic growth’, business cycles, inflation,
unemployment, and the balance of payments.
Macroeconomics focuses on the cycle in activity,
whereas growth theory focuses on determinants of
the long-run trend in output.
3. Learning Outcomes
The GDP gap is the difference between actual real
GDP and its potential or trend value.
The total output of the economy as a whole is the
sum of the value added by each firm or enterprise.
4. Learning Outcomes
GDP can be measured as the
sum of value added by all producers,
as the sum of income claims generated in producing goods
and services,
or as the spending on all final goods and services produced.
GDP measures the value of what is produced in this
country, while GNI (or GNP) measures the income
accruing to UK residents, including net income from
overseas.
GDP is a specific measure of output in the market
economy, and is not a measure of welfare or happiness.
5. INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
What is Macroeconomics
Macroeconomics is about the economy as a whole. It
studies aggregate phenomena, such as business
cycles, living standards, inflation, unemployment, and
the balance of payments. It also asks how
governments can use their monetary and fiscal policy
instruments to help stabilize the economy.
6. INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
Why do We Need Macroeconomics
Macroeconomics is useful because it enables us
to study events that affect the economy as a
whole without getting into too much detail about
specific products and sectors.
7. The GDP gap
Potential GDP is the level of national output that
would be produced if the economy were operating
at its normal capacity, of full-employment level.
The GDP gap is the difference between actual GDP
and its potential level.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
8. Measurement of National Output
Each firm’s contribution to total output is equal to
its value added, which is the gross value of the
firm’s output minus the value of all intermediate
goods and services - that is, the outputs of other
firms - that it uses.
Goods that count as part of the economy’s output
are called final goods; all others are called
intermediate goods. The sum of all the values
added produced in an economy is called gross
value added at basic prices.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
9. Measurement of National Output
Goods that count as part of the economy’s output
are called final goods; all others are called
intermediate goods.
The sum of all the values added produced in an
economy is called gross value added at basic
prices. Basic prices are the prices received by
producers net of taxes on products [plus
subsidies].
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
10. The circular flow of income, output and
spending
The determination of GDP and national
income can be represented as a circular
flow of income and spending.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
11. The circular flow of income, output, and
spending
Withdrawals of spending arise when
income received is not spent on the
domestic economy.
Injections of spending are those that are
not the result of domestic income receipts,
but rather come from sources other than
domestic income recipients.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
14. Individuals provide labour to firms and they
buy the firms’ output.
National output or income can be measured
from the expenditure side in terms of
expenditure on the final output, or on the
income side in terms of value added and
factor incomes generated.
Saving, taxes and imports represent a leakage
from the circular flow.
The Circular Flow of Income, Output, and Expenditure
15. Investment, government consumption and
exports represent injections into the circular
flow.
For any equilibrium level of national activity
(GDP) injections must equal leakages.
So saving plus taxes plus imports must equal
investment plus government consumption plus
exports.
The Circular Flow of Income, Output, and Expenditure
16. GDP, GNI, and GNP
Gross domestic product, [GDP] can be calculated
in three different ways:
◦ [1] as the sum of all values added by all producers of both
intermediate and final goods
◦ [2] as the income claims generated by the total production
of goods and services; and
◦ [3] as the expenditure needed to purchase all final goods
and services produced during the period.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
17. From the expenditure side of the national
accounts GDP = Ca + Ia + Ga + [Xa - Ima].
Ca comprises private consumption expenditures.
Ia is investment in fixed capital [including
residential construction], inventories, and
valuables (jewellery, art etc).
Gross investment can be split into replacement
investment [necessary to keep the stock of capital
intact] and net investment [net additions to the
stock of capital].
Ga is government consumption. [Xa -IMa]
represents net exports, or exports minus imports;
it will be negative if imports exceed exports.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
18. GDP income-based adds up all factor rewards in
production.
The main income categories making up GDP are
operating surplus, mixed incomes and
compensation of employees.
Operating surplus is net business income after
deduction of payment made to employees and for
material input but before direct taxes ie corporate
tax etc. Operating surplus is largely the firm’s
profit ie both distributed (dividends) and retained
earnings.
Mixed income is income earned by self employed
individuals and consists both of wage and salary
of the self employed and profit or surplus of the
business operated by them.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
19. Compensation of employees is the payment for
the services of labor inclusive of net salary, taxes
withheld and other deductions made for pension
etc ie wages are measured gross.
UK GDP measures production that is located in
the United kingdom, and UK gross national
income [GNI] measures income accruing to UK
residents.
The difference is due to net income from abroad.
GNI is the same thing as what used to be called
gross national product [GNP].
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
21. GDP
Plus: Receipts of factor income from the rest of the
world
Less: Payments of factor income to the rest of the
world
Equals: GNP
Less: Depreciation
Equals: Net national product (NNP)
Less: Statistical discrepancy
Equals: National income
22. GDP at Factor Cost vs GVA at Basic Prices
In place of GDP at factor cost, gross value added (GVA) at
basic prices will be used now.
For a producer, GDP at factor cost represents what he gets
from the industrial activity. This can be broken down into
various components — wages, profits, rents and capital —
also commonly known factors of production.
Aside from these costs, producers may also incur other
expenses such as property tax, stamp duties and
registration fees, among others. Similarly, producers may
also receive subsidies (production related) such as input
subsidies to farmers and to small industries. It is only taxes
and subsidies on intermediate inputs are adjusted.
For arriving at the new gross value added (GVA) at basic
prices, production taxes, such as property tax, are added
and subsidies are subtracted from GDP at factor cost.
23. GDP at Factor Cost vs GVA at Basic
Prices
Put simply, GVA at basic price represents what accrues
to the producer, before the product is sold.
The price paid by the consumer is not the same as the
revenue received by the producer. This is because of
the taxes that are paid to the government in the form of
indirect taxes.
GVA at basic prices will include production taxes and
exclude production subsidies available on the
commodity.
GVA at factor cost includes no taxes and excludes no
subsidies.
GDP at market prices include both production and
product taxes and excludes both production and product
subsidies.
24. Production taxes vs Product taxes
Production taxes/subsidies are independent of
the quantity (volume) of production. It is often imposed
even if the products are not produced (Eg: tax —land
revenues, stamps fees, registration fees tax on the
profession; subsidies —subsidies to Railways, input
subsidies to farmers, subsidies to the village and small
industries, administrative subsidies to corporations or
cooperatives, etc.).
Product taxes/subsidies depend on quantity produced.
Product taxes or subsidies are paid or received on per
unit of product (Eg: tax —excise tax, sales tax, service
tax and import and export duties; subsidies — food,
petroleum and fertiliser subsidies, interest subsidies
given to farmers, households, etc)
25. Real GDP is calculated to reflect changes in real
volumes of output and real income.
Nominal GDP reflects changes in both prices and
quantities.
Any change in nominal GDP [or GNI] can be split
into a change in real GDP and a change due to
prices.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
26. GDP deflator / Implicit deflator
GDP deflator is the price index used to
deflate nominal GDP.
It is a broad measure of economy-wide
inflation as it includes prices of all goods &
services in economy
Real Gross Domestic Product (GDP) is an
economic measure of the value of output produced
by the economy adjusted for price changes (that
is, inflation or deflation)
26
100
GDP
Real
GDP
price
current
or
Nominal
deflator
GDP
27. Personal income is income received by individuals
before any allowance for personal taxes.
Personal disposable income is the amount
actually available for individuals to spend or to
save, that is, income minus taxes.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
28. Interpreting National Income and Output
GDP and related measures of national income
and output must be interpreted with their
limitations in mind.
GDP excludes production that takes place in the
underground economy or that does not pass
through markets.
It excludes services of housewives, work done by
self etc
It also excludes economic bads such as damage
done to environment etc.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT
29. Interpreting National Income and Output
Moreover, GDP does not measure everything that
contributes to human welfare.
GDP is one of the best measures available of the
total economic activity within a country.
It is particularly valuable when changes in GDP
are used to indicate how economic activity has
changed over time.
INTRODUCTION - MACROECONOMIC ISSUES AND
MEASUREMENT