Download Years

Graphical presentation
of data (use of scale)
Exchange rate
Rs/$
90
60
30
1990
1991
1992
1993
1994
Years
1995 1996
1997
1998
1999
Rs/$
Graphical presentation of data
(use of scale) Exchange rate
65
45
25
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Years
5 people in the economy
Income in (000)s
A
B
C
Old government
100
110
120
130 140
New government
60
70
75
300 450
Mean (old government) = 610 = 122
D
E
Median (old government) = 120
5
Mean (new government) = 955 = 191
5
Median (new government) = 75
Year
Real
GDP
growth
rate
1979 1980
1%
-5%
1981
1982
1983
1%
3%
4%
1984 1985 1986
5%
2%
Between 1982 & 1985, average growth rate = 3.5%
Between 1979 & 1986, average growth rate = 1.5%
1%
Difference between total value and
value added
• Firm A: Produces steel from raw iron and sells it for
Rs 100,000 to firm B.
• Firm B: Buys steel worth Rs 100,000 then processes
it to produce a car body worth Rs 200,000.
• Firm C: Buys the car body, adds the other parts etc.
and sells complete car for Rs 450,000.
Value added or GDP:
Value of transactions: 100,000 + 200,000 + 450,000
= 750,000
GDP = Sum of the value added by each of the firms:
= 100,000 + ( 200,000 – 100,000) + (450,000 – 200,000)
= 100,000 + 100,000 + 250,000 = 450,000 GDP.
Also total expenditure of consumer on car = 450,000
Good
Col 1
Seller
Col 2
Buyer
Col 3
Trans Value
Col 4
Steel
Steel
producer
Machine
producer
100,000
Steel
Steel
producer
Car
producer
300,000
Machine
Machine
producer
Car
producer
200,000
Tyres
Tyre
producer
Car
producer
50,000
Cars
Car
producer
Consumer
500,000
Total value of
transaction
-
-
1,150,000