...Assignment 2: What is Gross Domestic Product? Jeanette Macintyre Argosy University ECO 201 Assignment 2: What is Gross Domestic Product? Based on the information contained on the website http://www.bea.gov/index.htm, answer the following questions: 1. What was Real GDP for 2009? According to Table 1.1.6. (Real Gross Domestic Product, Chained Dollars) the GDP of 2009 is 14,418 billion dollars (“Table 1.1.6”, 2015). a. What does GDP tell us? GDP is the output of goods and services by labor and property. GDP measures aggregate final production taking place in a country. GDP = Consumption + Investment + Government spending + Net exports (Colander, 2007 pg 159). b. How did GDP change from 2008? According to Table 1.1.6. (Real Gross Domestic Product, Chained Dollars) the GDP of 2008 was 14,830(“Table 1.1.6”, 2015). That is a decrease of 412 billion dollars in 2009 a difference of 2.8% (“Table 1.7.1”, 2015). c. What caused these changes? The change was due to a decrease in durable goods in 2009. According to Table 1.1.6 (Real Gross Domestic Product, Chained Dollars) in 2008, durable goods were at 1,083 billion dollars and a decrease of 60 billion dollars down to 1,023 billion dollars in 2009, a 5.85% reduction in expenditures (“Table 1.1.6”, 2015). 2. What was GNP for 2009? According to Table 1.7.5. (Relation of Gross Domestic Product, Gross National Product, Net National Product, National Income, and Personal Income) the GNP in 2009 was 14,569 billion dollars (“Table...
Words: 1277 - Pages: 6
...National Income in India, Concept and Measurement General Economics National Income • National income is the money value of all the final goods and services produced by a country during a period of one year. National income consists of a collection of different types of goods and services of different types. General Economics: National Income in India, Concept & Measurement 2 National Income • Since these goods are measured in different physical units it is not possible to add them together. Thus we cannot state national income is so many millions of meters of cloth. Therefore, there is no way except to reduce them to a common measure. This common measure is money. General Economics: National Income in India, Concept & Measurement 3 Basic Concepts in National income • Gross domestic product • Gross domestic product at constant price and at current price • Gross domestic product at factor cost and Gross domestic product at market price General Economics: National Income in India, Concept & Measurement 4 Basic Concepts in National income • • • • Net domestic product Gross national product Net national Product Net national product at factor cost or national income General Economics: National Income in India, Concept & Measurement 5 Gross Domestic Product • Gross domestic product is the money value of all final goods and services produced in the domestic territory of a country during an accounting...
Words: 3320 - Pages: 14
...regression analysis, I compared National health expenditures and Gross Domestic Products of United States by years from 1960 to 2009. The trend line indicates a positive correlation between the two variables, indicating that the two variables are related. First Regression analysis: Regression Equation: National health expenditures = - 161.1464 + 0.1677 * Gross domestic product R | 0.99297 | R Square | 0.98599 | t Statistic | 58.12474 | Standard Error | 88.03083 | p-value | 0.0000000000905707 | This shows a strong positive correlation between the two variables, based on both the large value of the t statistic and the small p-value. From my data set, there are no specific outliers which make a regression analysis weaken, therefore I will use my first data analysis as well. But before describe my data regression, I will show my second data regression which comes out after removing one outlier. For my second data regression analysis, I removed 2009 data because the GDP of United States was slightly decreased. (Again, there are no outstanding residuals for my data set, so I just demonstrate the other data regression according to the instruction) This is data regression analysis from 1960 to 2008. Second Regression analysis: R | 0.99389 | R Square | 0.98781 | t Statistic | 61.71547 | Standard Error | 77.79528 | p-value | 0.0000000000224389 | Regression Equation: National health expenditures =- 151.8092 + 0.1647 * Gross domestic product As shown the second data...
Words: 1797 - Pages: 8
...Economic measures such as the Gross Domestic Product (GDP) and the Gross National Product (GNP) are used to gauge the growth of an economy. Economic development is all about increasing the wealth in a nation as a whole. Economic development is the promotion of more intensive and more advanced economic activities through such means as education, improved tools and techniques, more available financing, better transportation, and creation of new businesses, (Microsoft Student, 2009a). Gross Domestic Product (GDP) is the total value of goods and services produced in a country over a year. It is an estimate of market throughput, adding together the value of all final goods and services that are produced and traded for money within a given period of time. Gross Domestic Product (GDP) is calculated by adding up the value of all goods and services that are produced, by adding up the expenditure on goods and services at the time of sale and lastly by adding up the producer incomes from the sale of goods or services. Gross Domestic Product (GDP) measures a country’s economic activities regardless of who owns the productive assets in that country, (Costanza etal, 2009:5). One key difference between the two concepts therefore is the value of production by multinational companies which is sent home from abroad. Another difference between the two measures of economic development is that GDP is a better measure of the state of production in the short term whilst GNP is a better measure...
Words: 1724 - Pages: 7
...Approach to Calculating GDP Nominal GDP- the market value of all final goods and services from the nation in a given period of time. Table 1. Gross Domestic Product or nominal GDP (in Billions of dollars) | | 2012 | 2013 | | | III quarter | IV quarter | I quarter | II quarter | 1 | Gross domestic product | 16,356.0 | 16,420.3 | 16,535.3 | 16,661.0 | 2 | Personal consumption expenditures | 11,193.6 | 11,285.5 | 11,379.2 | 11,427.1 | 3 | Gross private domestic investment | 2,493.3 | 2,499.9 | 2,555.1 | 2,621.0 | 4 | Net exports of goods and services | -524.4 | -515.8 | -523.1 | -509.0 | 5 | Government consumption expenditures and gross investment | 3,193.5 | 3,150.7 | 3,124.1 | 3,121.9 | Table 2. Real Gross Domestic Product (in Billions of chained dollars) Real Gross Domestic Product (real GDP) is a macroeconomic measure of the value of economic output adjusted for price changes. | | 2012 | 2013 | | | III quarter | IV quarter | I quarter | II quarter | 1 | Gross domestic product | 15,534.0 | 15,539.6 | 15,583.9 | 15,679.7 | 2 | Personal consumption expenditures | 10,541.0 | 10,584.8 | 10,644.0 | 10,691.9 | 3 | Gross private domestic investment | 2,456.5 | 2,441.8 | 2,470.1 | 2,524.9 | 4 | Net exports of goods and services | -436.5 | -412.1 | -422.3 | -424.4 | 5 | Government consumption expenditures and gross investment | 2,988.8 | 2,938.8 | 2,907.4 | 2,904.5 | During the inflation the nominal GDP is higher than real GDP, because real values...
Words: 1698 - Pages: 7
...investment freedom. Most notably, freedom from corruption has declined by over 25 points, undermining the rule of law. Over the past two decades, Malaysia’s economy has mostly been rated “moderately free.” Registering one of the 10 best score improvements in the 2014 Index, Malaysia has charted an upward trajectory of economic freedom for the past five years. It has undertaken wide-ranging reforms to address various structural weaknesses and improve competitiveness. Recent reforms have put greater emphasis on improving regulatory efficiency, enhancing regional competitiveness, and modernizing the financial sector. a. BACKGROUND The ethnically and religiously diverse constitutional monarchy of Malaysia has been ruled by the United Malays National Organization since independence in 1957, but dissatisfaction with pro-Malay affirmative-action programs and...
Words: 3116 - Pages: 13
...UNIT I NATIONAL INCOME AND MACROECONOMICS 1 National Income National Income is defined as the sum total of all the goods and services produced in a country, in a particular period of time. Normally this period consists of one year duration, as a year is neither too short nor long a period. National product is usually used synonymous with National income. Alfred Marshall in his ‘Principle of Economics’ (1949) defines National income as “The labour and capital of a country, acting on its natural resources, produce annually a certain net aggregate of commodities, material and immaterial, including services of all kinds…..and net income due on account of foreign investments must be added in. This is the true net National income or Revenue of the country or the national dividend.” Irving Fisher defined national income as “The national dividend or income consists solely of services as received by the ultimate consumers, whether from their material or from human environments. Thus, a piano or an overcoat made for me this year is not a part of this year’s income, but an addition to capital. Only the services rendered to me during this year by these things are income.” Central Statistical Organization defines National income as “National Income is the sum of factor income earned by the normal residents of a country in the form of wages, rent, interest and profit in an accounting year.” Concepts of National Income There are different concepts of National Income, namely; GNP...
Words: 2044 - Pages: 9
...UNIT I NATIONAL INCOME AND MACROECONOMICS 1 National Income National Income is defined as the sum total of all the goods and services produced in a country, in a particular period of time. Normally this period consists of one year duration, as a year is neither too short nor long a period. National product is usually used synonymous with National income. Alfred Marshall in his ‘Principle of Economics’ (1949) defines National income as “The labour and capital of a country, acting on its natural resources, produce annually a certain net aggregate of commodities, material and immaterial, including services of all kinds…..and net income due on account of foreign investments must be added in. This is the true net National income or Revenue of the country or the national dividend.” Irving Fisher defined national income as “The national dividend or income consists solely of services as received by the ultimate consumers, whether from their material or from human environments. Thus, a piano or an overcoat made for me this year is not a part of this year’s income, but an addition to capital. Only the services rendered to me during this year by these things are income.” Central Statistical Organization defines National income as “National Income is the sum of factor income earned by the normal residents of a country in the form of wages, rent, interest and profit in an accounting year.” Concepts of National Income There are different concepts of National Income, namely; GNP...
Words: 2044 - Pages: 9
...ROLL- No 57 [COUNTRIES JAPAN & Hong Kong] GDP The gross domestic product (GDP) or gross domestic income (GDI) is one of the measures of national income and output for a given country's economy. GDP can be defined in three ways, all of which are conceptually identical. First, it is equal to the total expenditures for all final goods and services produced within the country in a stipulated period of time (usually a 365-day year). Second, it is equal to the sum of the value added at every stage of production (the intermediate stages) by all the industries within a country, plus taxes less subsidies on products, in the period. Third, it is equal to the sum of the income generated by production in the country in the period—that is, compensation of employees, taxes on production and imports less subsidies, and gross operating surplus (or profits) .Japan GDP Analysis The Gross Domestic Product (GDP) in Japan was worth 5867.15 billion US dollars in 2011, according to a report published by the World Bank. The GDP value of Japan is roughly equivalent to 9.46 percent of the world economy. Historically, from 1960 until 2011, Japan GDP averaged 2335.35 Billion USD reaching an all time high of 5867.15 Billion USD in December of 2011 and a record low of 44.31 Billion USD in December of 1960. The gross domestic product (GDP) measures of national income and output for a given country's economy. The gross domestic product (GDP) is equal to the total expenditures for all final goods...
Words: 5956 - Pages: 24
...were produced in earlier periods. (b) final goods that remain in inventories. (c) goods that are used up in the production of other goods in the same period that they were produced. (d) either capital goods or inventories. Ans: C 2. The three methods to measuring national income are the (a) cost, income, and expenditure methods. (b) product, income, and expenditure methods. (c) income, output, and expenditure methods. (d) income, cost, and product methods. Ans: C 3. 1983 1984 National income $40000 $48000 Price index 100 125 What is ratio of the national income? A.Fall of 4% C.Fall of 5% B.Rise of 4% D.Rise of 5% 4. Measuring the level and rate of growth of national income is important for seeing: A.The rate of economic growth B.Changes to average living standards C.Changes to distribution of income D.All are correct 5. What is Net property income from abroad? A an aggregate measure of production equal to the sum of the gross values added of all b resident, institutional units engaged in production. B the market value of all the products and services produced in one year by labour and property supplied by the citizens of a country C the income of one or many persons or one or many enteprises after deducting all taxes of that country. D B and C are true. Đáp án C 6. Total income of residents in Viet Nam is 5...
Words: 983 - Pages: 4
...of the overall economy profoundly affects all of us, changes in economic conditions are widely reported by the media. Indeed, it is hard to pick up a newspaper without seeing some newly reported statistic about the economy. The statistic might measure the total income of everyone in the economy (GDP), the rate at which average prices are rising (inflation), the percentage of the labor force that is out of work (unemployment), total spending at stores (retailsales), or the imbalance of trade between the united states and the rest of the world (the trade deficit). All these statistics are macroeconomic. Rather than telling us about a particular household or firm, they tell us something about the entire economy. Meaning and Concepts of National Income (NI) * Consumption is the final aim of the all economic activity .But it must be preceded by production distribution and exchange...
Words: 6867 - Pages: 28
...GROSS DOMESTIC PRODUCT 1 What is Gross Domestic Product? Jesse Leslie Argosy University Macroeconomics George Williams 07/ 26/2014 GROSS DOMESTIC PRODUCT 2 Current-Dollar and "Real" Gross Domestic Product | 6/25/14 | | | | | | | | | | Annual | | Quarterly | | | | | | | (Seasonally adjusted annual rates) | | | | | | | | | | | | | GDP in billions of current dollars | GDP in billions of chained 2009 dollars | | | GDP in billions of current dollars | GDP in billions of chained 2009 dollars | | | 1982 | 3,345.0 | 6,484.3 | | 1960q2 | 542.7 | 3,108.4 | 1983 | 3,638.1 | 6,784.7 | | 1960q3 | 546.0 | 3,116.1 | 1984 | 4,040.7 | 7,277.2 | | 1960q4 | 541.1 | 3,078.4 | 1985 | 4,346.7 | 7,585.7 | | 1961q1 | 545.9 | 3,099.3 | 1986 | 4,590.1 | 7,852.1 | | 1961q2 | 557.4 | 3,156.9 | 1987 | 4,870.2 | 8,123.9 | | 1961q3 | 568.2 | 3,209.6 | 1988 | 5,252.6 | 8,465.4 | | 1961q4 | 581.6 | 3,274.6 | 1989 | 5,657.7 | 8,777.0 | | 1962q1 | 595.2 | 3,333.6 | 1990 | 5,979.6 | 8,945.4 | | 1962q2 | 602.6 | 3,369.5 | 1991 | 6,174.0 | 8,938.9 | | 1962q3...
Words: 2900 - Pages: 12
...economic terms? a. National Income accounting * A system used by the government to determine economic activity. b. Expenditure, output and income approaches * The expenditures approach says GDP= consumption + investment + government expenditure + exports - imports. The income approach sums the factor incomes to the factors of production. The output approach is also called the "net product" or "value added" approach. c. Final and intermediate goods * An intermediate good is a good or service that is used in the eventual production of a final good, or finished product. These goods are sold by industries to one another for the purpose of resale or producing other goods. d. Gross and net private domestic investment * Gross private domestic investment is the measure of physical investment used in computing GDP in the measurement of nations' economic activity. This is an important component of GDP because it provides an indicator of the future productive capacity of the economy. * Net private domestic investment indicates the total amount of investment in capital by the business sector that is actually used to expand the capital stock. e. Net exports * Net exports are the difference between a country's total value of exports and total value of imports. Depending on whether a country imports more goods or exports more goods, net exports can be a positive or negative value. f. GNP, NDP, NNP, NI * Gross national Product – the market value...
Words: 662 - Pages: 3
...CHAPTER 2 : MEASURING NATIONAL INCOME IMPORTANCE & DEFINITION OF NATIONAL INCOME (Gross Domestic Product (GDP)) • Importance – National income accounting measures level of economic production and explain immediate causes of that level of performance. – It compares economic conditions over time. – It provides a basis for formulation and application of appropriate public policies in order to improve economic performance. • Definition – Total market value of all final goods & services produced in a country in 1 year. – It is measured in terms of monetary value. – National income accounting avoids double counting since only final product is being counted. – Higher production indicates greater use of economic resources and as more inputs are used the income for resource suppliers will also increase together with employment opportunities and vice versa. – GDP excludes: ▪ Purely financial transactions (eg: public transfer payments such as pensions, private transfer payments (eg: money gifts and security transactions such as sales of stocks and bonds since they do not involve the actual production of goods and services. ▪ Secondhand sales because they are not current product. CIRCULAR FLOW OF INCOME IN 2, 3 & 4 SECTOR ECONOMY • Circular of income – Referring to Figure 2.1, what is spent on a product being produced is income to those who have contributed their resources to producing and selling it. – Under this we are assuming...
Words: 2604 - Pages: 11
...Corporate type) | Key Economic Influences | Key Government (Regulatory) Influences | Key Legal (Law and Litigation) Influences | Riordan Manufacturing | Manufacturing | Gross National Product (GNP) or Gross Domestic Product (GDP) growth rateInventory levels | Export restrictions Import tariffs and quotasPolitical stability | Worker safety laws (OSHA)Union regulationsMinimum wage laws | Huffman Trucking | Transportation and logistics | Gross National Product (GNP) or Gross Domestic Product (GDP) growth rate | Regulation | Union regulationsLocal laws & licensesWorker safety laws (OSHA) | Kudler Fine Foods | Food and Beverage | Unemployment rate Consumer confidence | Import tariffs and quotas | Minimum wage laws Consumer protection laws Worker safety laws (OSHA) | McBride Financial Services | Financial Services | Interest ratesMonetary policies Balance of payments | Income tax rates | Consumer protection laws Minimum wage laws Local laws & licenses | The Elias Group | Defense and Aerospace | Consumer confidence Monetary policiesGross National Product (GNP) or Gross Domestic Product (GDP) growth rate | Government debt | Consumer protection laws Minimum wage laws | Smith Systems Consulting | Consumer Goods and Services | Gross National Product (GNP) or Gross Domestic Product (GDP) growth rate Consumer confidence. | Regulation | Minimum wage laws Local laws & licenses | Sparrow, Johnson, &...
Words: 267 - Pages: 2
