Download GDP

‫ﺑﺎﺳﻣﮫ ﺗﻌﺎﻟﻲ‬
‫ﮔﺮوﻩ اﻗﺘﺼﺎد‬
‫ﺗوﻟﯾد ﻧﺎﺧﺎﻟص داﺧﻠﯽ‬
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GDP Deflator
 Implicit Price Level
 implicit price level = nominal GDP / real GDP
 for 2007a: deflator = 550/468.5 = 1.17
 for 2007b: deflator = 550/639 = 0.86
 multiply by 100 to put into an index: 117 and 86
 What do these numbers tell us?
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Real GDP As A Measure Of Welfare
 What is the relationship between real GDP and our
standard of living?
 What are some problems with real GDP as a welfare
measurement?
 does not account for income distribution
 does not include most nonmarket goods
 does not account for leisure time
 does not consider environmental damage
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Alternative Ways To Get GDP
 What are the three different ways to calculate GDP?
1. Expenditure Approach
 Spending by households, businesses, the government
and foreigners
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Expenditure Components of US GDP: 2005
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Alternative Ways To Get GDP
 What are the three different ways to calculate GDP?
1. Expenditure Approach
2. Income Approach
 Income earned by the different factors of production.
 Make sure that you avoid double counting and only
include the value added
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Hypothetical Data For Calculation of National Income
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U.S. National Income By Type
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Alternative Ways To Get GDP
 What are the three different ways to calculate GDP?
1. Expenditure Approach
2. Income Approach
 Income earned by the different factors of production.
 Make sure that you avoid double counting and only
include the value added
 To get to GDP need to account for capital depreciation
and income receipts and payments from the rest of the
world.
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Relations Between U.S. GDP and Income
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Alternative Ways To Get GDP
 What are the three different ways to calculate GDP?
1. Expenditure Approach
2. Income Approach
3. Production Approach
 national income broken down into the different
production sectors in the economy.
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U.S. Income By Sector: 2005
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Refrences
 Slides from the Book: Macroeconomics by Bernanke
and Abel: Copyrighted: 2011 Pearson Addison-Wesley
 Slides from Dr Masood Nili Class notes: Principles of
Economics. Copyrighted material.
 Slides from Barro’s Macroeconomic book