HideShow resource information
View mindmap
  • GDP
    • Measure of the value of output produced in an economy
      • Used to measure economic growth
    • Calculated by:
      • The income method
        • Total of all wages + salaries, profits, rent +interest earned.
          • Rewards for factors of production
        • No transfer payments/benefits are counted; there is no exchange
        • Accurate except for the informal economy
      • The expenditure method
        • Adds together all final spending on g/s produced in an economy
        • Spending by consumers, investment, g speding and net exports.
      • The output/ value added method
        • Values added at each stage of production
          • The most inaccurate due to double- counting
    • The monetary value of all goods and services produced in an economy in a year = GDP
    • Nominal GDP
      • Face value
    • Real GDP
      • Constant values compared to a base year (they take inflation into account)
    • The informal economy is a big problem


No comments have yet been made

Similar Economics resources:

See all Economics resources »See all Inflation and Unemployment resources »