Card Set Information
study of the nation’s economy as a whole: focuses on the issues of inflation, unemployment, and economic growth.
sustained increases in the average prices of all goods and services.
Circular flow of production and income
circular flow shows how the production of good and services generates income for households and how households purchase goods and services produced by firms
Gross domestic product (GDP)
the total market value of final goods and services produced within an economy in a given year.
Goods used in the production process that are not final goods and services
A measure of GDP hat controls for changes in prices
The value of GDP in current dollars
Sustained increases in the real GDP of an economy over a long period of time
Purchases of newly produced goods and services by households
Private Investment Expenditures
Purchases of newly produced goods and services by firms
Total new investment expenditures
Reduction in the value of capital goods over a one-year period due to physical wear and tear and also to obsolescence; also called capital consumption allowance
Gross investment minus depreciation
Purchases of newly produced goods and services by local, state, and federal governments
Payments from governments to individuals that do not correspond to the production of goods and services
A good or service that is produced in a foreign county and purchased by resident of the home country
A good or service that is produced in the home country and purchased by the foreign country
Exports minus imports
The excess of imports over exports
The excess of exports over imports
The total income earned by a nation's residents both domestically and abroad in the production of goods and services.
Gross National Product
GDP plus net income earned abroad
Income, including transfer payments, received by households