Measurements of economic performance

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  • Created by: Lottie
  • Created on: 13-03-12 16:29

Economic growth

  • measured  using national income
  • actual growth = increase in GDP- gross domestic product
  • potential growth- increase in productive capacity of country
  • real values have been ajusted to remove effects of inflation
  • nominal- current Y without adjustments
  • value- qaulity
  • volume- quantity

How is GDP measured?

  • sum of all goods & services produced in a year  by a country
  • sum of incomes/expenditure
  • circular flow of income: injections & leakages
  • increases = country is growing- implies…


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