Beruflich Dokumente
Kultur Dokumente
1900-1920
Prediction
2011
Actual Figure
Prediction
Actual Figure
47
78.37
$520
(5609.15 in
todays dollars)
$48,147
40%
15.1%
(46.2 million)
22%
92%
economy as a whole.
i.e. inflation, unemployment, and economic growth
Gross Domestic Product (GDP) the total market value of all final goods
and services produced within a countrys borders in a given period of
time.
Measures the economys total income
Total income = total expenditure
products
Hair products and haircuts
produced currently.
Included - New car
Excluded - used car
countrys borders.
Counted - Japanese company in the U.S.
Not Counted - Am. Company in Japan
interval of time,
Usually a year or quarter (three months)
Components of GDP
Four components:
GDP (Y) = C + I + G + NX
1.
2.
3.
4.
Consumption
Investment
Government
Net Exports
Quantity
Consumption Car Sales
10
Fast Food Sales
12
Personal Computers
50
Business Computers
Telecommunications
15
10
45
300
$20 ____________________________
300
$30 ____________________________
$200 ___________________________
9000
Government
Military Personnel
Helicopters
Roads
5
2
1
Net Exports
*Figure this
amount by taking
Exports minus
Imports*
Total
Exports
Total
Imports
Investment
Tractors
250000
$50,000 __________________________
400000
$200,000 __________________________
300000
$300,000 __________________________
$10,000
$20,000
-10000
__________________________
$961,000
Total Gross Domestic Product = _______________________________
smuggling, etc.
GDP Simulation
Year
Price
Quantity Sold
Total GDP
Nominal GDP GDP measured in name only (current prices), not adjusted for inflation.
Real GDP GDP expressed in fixed (unchanging prices), adjusted for inflation.
1.
Nominal GDP GDP measured in name only (current prices), not adjusted for inflation.
Real GDP GDP expressed in fixed (unchanging prices), adjusted for inflation.
1.
Nominal GDP GDP measured in name only (current prices), not adjusted for inflation.
Real GDP GDP expressed in fixed (unchanging prices), adjusted for inflation.
1.
1.
Nominal GDP GDP measured in name only (current prices), not adjusted for inflation.
Real GDP GDP expressed in fixed (unchanging prices), adjusted for inflation.
1.
1.
Total = $350,000
Total = $370,000
Nominal GDP GDP measured in name only (current prices), not adjusted for inflation.
Real GDP GDP expressed in fixed (unchanging prices), adjusted for inflation.
1.
1.
1.
Total = $350,000
Total = $370,000
Nominal GDP GDP measured in name only (current prices), not adjusted for inflation.
Real GDP GDP expressed in fixed (unchanging prices), adjusted for inflation.
1.
1.
1.
Total = $350,000
Total = $370,000
GDP Deflator
Year 2 Nominal GDP $370,000
Year 2 Real GDP - $350,000
370,000
_____________ 100 = 106
350,000
6%
_____rise
in inflation
$8
$9
1990
1995
$11
$10
2000
2012
Year
Price
Units
Sold
Nomina Real
l GDP
GDP
1990
$8
10
$80
$80
2012
$11
10
$110
$80
$8
$9
1990
1995
$10
2000
Year
Price
Units
Sold
1990
$8
10
2012
$11
10
$11
2012
Nomina Real
l GDP
GDP
Inflation
and
Inflation
Rate
Inflation inflation is a rise in the general level of prices of goods and services in
an economy over a period of time.
Inflation Rate - percentage change in some measure of the price level from one
period to the next.
GDP Deflator an index that converts output measured at current prices into
constant-dollar GDP.
The GDP deflator shows inflation, how much a change in the base year's GDP relies upon changes in
the price level.
GDP
Prices and Quantities
Price of Hamburgers
Year
2005
2006
2007
$1
$2
$3
100
150
200
2005
2006
2007
2005
2006
2007
2005
2006
2007
2005
2006
2007
$100
$100
$200
Total Market Value for Hot Dogs __________
+ Total Market Value for Hamburgers __________
= __________
$150
$200
$350
Total Market Value for Hot Dogs __________
+ Total Market Value for Hamburgers __________
= ___________
$200
$300
$500
Total Market Value for Hot Dogs __________
+ Total Market Value for Hamburgers __________
= __________
2005
2006
2007
$2
$3
$4
Quantity of Hamburgers
50
100
150
Calculating GDP
1.
2. Calculate the nominal GDP for each year, then calculate the GDP deflator for year 2 using
year 1 as a base year.
PRODUCTION AND PRICES
YEAR 1
YEAR 2
GOODS
OUTPUT
PRICES
OUTPUT
PRICES
APRICOTS
10
$50
10
$55
BROCCOLI 10
$25
12
$25
CARROTS
$25
$30
10
__1120
1025
Year 1:
2 Real GDP:
Apricots - $500
Broccoli - $300
Carrots - $225
Total GDP - $1025
Year 2:
2Nominal:
Apricots - $550
Broccoli - $300
Carrots - $270
Total GDP - $1120
= _______X
100 = _____
1.09
109 = 9% inflation
Business Cycles
1.
2.
3.
4.
Rise in unemployment
Recession
Recession a prolonged
economic contraction
Real GDP falls for two
consecutive quarters
(6 straight months)
Rise in unemployment, falling
profits, bankruptcies,
foreclosures, etc.
GDP
Depression
Stagflation
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
Economic Growth
Economic Growth sustained increases in an economys real
GDP
Real GDP per capita real GDP divided by the total population
Per Capita for each person
Average income for each person in a country
GDP
and
Quality
of
Life
Nations with higher per capita GDP enjoy higher quality of life, such as:
Better Nutrition
Comfortable housing
Longer life spans
Better education
Infrastructure/Telecommunications
(cable, internet, phone lines, etc.)
Productivity the amount of goods and services produced for each unit of
labor input
High productivity leads to high per capita real GDP = high standard of
living
Growth rate - how rapidly real GDP per person grows in a typical year
U.S. real GDP per capita $3,752 in 1870 and $44,260 in 2006; 1.83%
growth rate per year
Technological Progress
Technological progress producing more output without
Ex. India, large population and low productivity, equals low wages and
quality of life
Ex. United States, consistent population growth, high capital growth,
leads to high quality of life
Government government policies can affect a nations economic growth
Increased taxes, reduces disposable income which takes money away
from private investing
Natural Resources
Natural resources - inputs provided by nature that are converted into the
production of goods and services
Provided by nature, such as land, rivers, and mineral deposits
U.S. large supply of land and agriculture, Middle East oil supplies
Renewable Resources - are natural resources that can be reproduced.
Forest, wood, paper, energy (wind, solar power), etc.
Nonrenewable Resources - are natural resources that are limited in
supply.
Coal, gold, oil, etc.
47
Essential Question #1
What are the 4 components of GDP?
C Consumption
I Investment
G Government
NX Net Exports
Essential Question #2
What are the excluded components of GDP?
Intermediate Products
Second-Hand Sales
Non-Market Transactions
Cash Transfers
Essential Question #3
How do you calculate Real GDP and Nominal GDP?
dollars
prices
Essential Question #4
What are the characteristics of the 4 phases of the business cycle?
Essential Question #3
What does per capita GDP measure; what does it indicate about a
societys standard of living?
Higher the per capita GDP, the higher the standard of living.
Essential Question #4
How can a country improve its standard of living/per capita GDP??
1. Calculate the nominal GDP for each year, then calculate the GDP deflator for
each year using year 1 as a base year.
Year 1:
Bananas - $5
Backrubs - $30
Total GDP - $35
Year 2:
Bananas - $10
Backrubs - $42
Total GDP - $52
Year 3:
Bananas - $20
Backrubs - $54
Total GDP - $74
Macroeconomics
Gross Domestic Product
Nominal GDP
Real GDP
Expansion
Peak
Contraction
Trough
Recession
Depression
Stagflation
2011 GDP
Population
USA
$14,582,000,000,000
307,007,000
China
$5,879,000,000,000
1,338,000,000
Japan
$5,498,000,000,000
127,000,000
Germany
$3,286,000,000,000
82,372,000
France
$2,562,000,000,000
64,800,000
UK
$2,250,000,000,000
62,970,000
Brazil
$2,090,000,000,000
195,000,000
Mexico
$1,634,000,000,000
113,550,000
Russia
$1,479,000,000,000
142,860,000
Canada
$1,474,000,000,000
33,680,000
Population Rank
Practice Ch. 12
a. Consumption
b. No, because that transaction is a cash transfer,
not a purchase of currently produced capital
goods.
c. It means that imports exceed exports.
Practice Ch. 12
Practice Ch. 12
a.
b.
c.
d.
e.
f.
g.
h.
Practice Ch. 12
Investment
Machinery
Computers
Cell Phones
10
30
45
$8000 ____________________________
$1500 ___________________________
$200 ___________________________
Government
Single Family
Multifamily
Commercial
3
5
1
$75,000 _________________________
$300,000 _________________________
$1,000,000 _________________________
Net Exports
*Figure this
amount by taking
Exports minus
Imports*
Total
Exports
$10,000
Total
Imports
$20,000
___________
- __________
=
___________ _________________________
Extra Credit
1. The country of Terrorville produces two goods: footballs and basketballs. The
following is a table showing the prices and quantities of output for three years.
Macroeconomics
2.
3.
4.
C spending by consumers
I spending by businesses ,
G spending by government,
NX spending by foreigners, minus imports
5.
6.
7.
8.
Consumption
Investment
Government
Net Exports
a.
Second-hand sale
b.
Government
c.
Investment
d.
Nonmarket Transaction
e.
Underground Economy
f.
Consumption
g.
Net Exports
h.
Product
Quantity
Intermediate
goods
10
12
50
15
10
45
50
500
100
Total
Exports
$10,000
Total
Imports
$20,000
Dollar Value
_________2,000,000___________________
_________120,000___________________
_________50000___________________
__________150,000__________________
__________900__________________
__________18,000_________________
__________250,000________________
__________30,000,000________________
__________5,000,000________________
_________-10000_________________
14.
15.
16.
a.
b.
c.
d.
Expansion
Peak
Contraction
Trough
Recession
Depression
Stagflation
Phase of Business Cycle:
Contraction
Peak
Trough
Expansion
Business Investment
help create output and jobs, increase create output and jobs, increase GDP
GDP
Interest Rates and
Credit
External Shocks
18.
Year
Price of Oranges
2005
2006
2007
$1
$2
$3
50
100
150
2005
2006
2007
2005
2006
2007
Total Market Value for Oranges $___50_____ + Total Market Value for Video Games $ ___50_____ = $____100_____
Total Market Value for Oranges $___200____ + Total Market Value for Video Games $ ___150____ = $____350____
Total Market Value for Oranges $___450____ + Total Market Value for Video Games $ ___300____ = $____750____
2005
2006
2007
2005
2006
2007
Total Market Value for Oranges $___50_____ + Total Market Value for Video Games $ ___50_____ = $____100_____
Total Market Value for Oranges $___100____ + Total Market Value for Video Games $ ___100____ = $____200____
Total Market Value for Oranges $___150____ + Total Market Value for Video Games $ ___150____ = $____300____
2005
2006
2007
$10
$15
$20
23.
24.
25.
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2.
Dollar value
b)
c)
3.
4.
5.
6.
7.
Investment
Machinery
Computers
Cell Phones
10
30
45
$8000 _________80,000__________________
$1500 _________45,000_________________
$200 _________9,000_________________
Government
Single Family
Multifamily
Commercial
3
5
1
$75,000 _________225,000________________
$300,000 _________1,500,000_______________
$1,000,000 _________1,000,000_______________
Net Exports
*Figure this
amount by taking
Exports minus
Imports*
Total
Exports
$10,000
Total
Imports
$20,000
___________
- __________
=
___________ _________-10,000________________
Year
Price of Milk
Quantity of Milk
2005
2006
2007
$1
$1
$2
100
200
200
2005
2006
2007
2005
2006
2007
Total Market Value for Milk ___100_______ + Total Market Value for Honey ___100_______ = ____200________
Total Market Value for Milk ___200_______ + Total Market Value for Honey ___200_______ = ____400________
Total Market Value for Milk ___400_______ + Total Market Value for Honey ___400_______ = ____800________
2005
2006
2007
2005
2006
2007
Total Market Value for Milk ___100_______ + Total Market Value for Honey ___100_______ = ____200_________
Total Market Value for Milk ___200_______ + Total Market Value for Honey ___200_______ = ____400_________
Total Market Value for Milk ___200_______ + Total Market Value for Honey ___200_______ = ____400_________
2005
2006
2007
$2
$2
$4
Quantity of Honey
50
100
100
Shift 2
Materials:
1 pair of scissors
1 Pen/Pencil
2 desks
10 sheets of paper
Procedure: Before this shift
begins, work as a group to
break the production process
into a series of steps.
- Cutting the paper
- Folding the paper
- Writing the Company Name
Record the results.
Shift 3
Materials:
Using the costs listed on the
productivity chart, decide as a
group what additional capital
goods you will purchase. You
have $10.00. You may acquire a
maximum of 6 desks, 3 scissors,
40 sheets of paper and 10
pencils. (You can also hire a new
laborer QCM)
Procedure: Before this shift
begins, determine the most
efficient manner of producing
the airplanes
7.
8.
9.
GDP Simulation
Year
Price
Quantity Sold
Total GDP
GDP Simulation
Year
Price
Quantity Sold
Total GDP
10
10
10
20
20
40