Chaplev & Measuring demeshe Output 2nd Netionad Income Various Measures dJQdP GNP NMP DLN D e NAP (net rraterial >| Ni NI product Counts af ex PL ork tangas » DIL DI on nokcoude Gob pee GiAne (both are monetary veliuns) Vane: the total market value of ate finok and cervices (Agarege output) : produced tathin “the terri tor of @ Cotto, vogardLles: of ewrenship, Burn a period of Lime Cosnatty & year) GNC: the total markal valine of alt final geots and Savi tes (agar fe outped) proBucedk a by its cihgens res artless of Location, Stiring a period ol, cana Cusaathy a. sidan),Page -2 To avoick multipfe counting GDP. Cank also Gwe) exchudes: DY att Gutenmobiake gords 2) AW non- proSwetive aed @) Trancfen poymonts (public) : b) Ty anster payments Cbvivate) ) Transactions of financial assets 3) ah Secendhancl sales Approaches to Barving GD? ) Expenditure approach 2) Sreeme Gphproack 2) Value- « &bek mithoc Gb pvea th Ex pendip ine Appr gach > addin okt expenditures made oy eco ene agents of ola four 0 : sects inthe cone > Ee: by QU Aeureholds (H), Dersinesses (®), arnmants (Gj), and foraignens (F) on Ree N output,Page -3 = ope SG +Ig+ G+, x Where} C tneluder abe personal Constumphien 2xpenditures, <9. 4) consumen Durables (ata) i) nRon-Suvable geeks Chass then ays) ti) S2rvices e has ter special Foodunes ; ® the fawgess Comonnsoct of GdP (= ¥0f) b) rabatvely etabLe x J, stands oss, private hemastie ee ek joa ni tures, Which includes [ i) AL nok purchases of 3 LF mackinenies, tools, fed E54 3 i) ALL ceastruchion ae ii) ALL inventories = a3 fz => Qnvestmant (15) can be broken \nto tuo pabts, te- PLannok (Fixed) and Inventory rnverd marl ¢Page -4 => I5 Aros two features a) most unstable and volatile 1b) the higten the rate offnvestment, +he faster arlh An econ aoe, ceteris paribus. oe > 4 Grvestmert) expandihnes made ORY pe depreciation (>) or Capital consumphon allowance or Wear and team of capital TSS ew investrent a Ty. = DAT AD wh investment He On Scere, aaa . Ls Lys D> Gagne Fea Ta D> ay Grewing econe a7 ee ie Sd ReocLining 2 ty LD = beam lt, LooPage 6 G Stands toy alt governinent purchases, offi ciatly Labekidias " gowrnmant Com btn 1OW expenditures ancl gross \nve stinsnt” G2neral ; , G= governmant spend but th Eve wen protien th ts Si fferent Government spendirins, Purchases Trans (or peqinent s (PoP cHwe) (non- product va) meg Aen DX Not include “Gin the GDP Ty GY im the, eqaksn counbe EPR agpebm this Port only. : => Crwrecied fe have of ‘6 (in theey oben) + &) 94 is Pnogenows Adobe rimok %)'G’ is steklelagen & => XK stank dv net expovts, re. exports —_ Tmport< = net 2x ports % anes County: : Lxports () => creStt urports (mM) => Aekid fey Any —ecencnay, X-M= X, Shin X=M => Xn=O > Trades paymed withthe rest gt iso {¢ : in balance x>mM => Xn >o => © Sun plus XM > XL Lom Aefict Now, GDP= C+ lL+Gex, Sex tie table | gee de xtbookPegs - 9 ACewm2 Approach => hadrus Up Income recoived bg aw fa clevs of proGluction Um The economy doko: W—> wages, salaries and alt otha compen sat ons fp Ls ALL ranks received euiehelds end businosies A> Aat dokenest de recived by Aeurehethe p> prafit names nreceived by ~~ Mai nesses @) aw Preprtetoy Incomes b) Ot cor pevate profits Wc ate Aisbuvied as: x x) Cov pevate profit ae ti) Hividends | d iii), und shy 7 “ovpevete surplus Creteinedd by bust nasses/e avpovaltons => Netronal Inume ov MES wae pp iy 6 ie ="Domastie HH FrPireet business ee « oe wer4irp eg Binee bus. tenesPage -2 Gpe= NIL + Net foreign fact tnermne ap Stetih cal Disene Pearcy + Depre dation (consumptron of fixed cept) DNC = GDP — Kepreciccior 3) NI = pe — Stotisheal BS chepan — Net Joreign jah Theme 4) PL (pa sorb ineme) = 4NE ; — DrPweed businesc tenes a Covpovate rogit taxes aA Aw public Warns 2, fegprents 8) DI (Atsposable treme) = PE - a personet taxes Spenbable Note: DiS C+ Sa Cons winphion fovingsPage -9 Nominal vs. Real GDP Nominal: expressedin Current market prices. Real: expressed tn base prices | : after alputmant inffation @r oo i" Grdex: MeASURLS Changes intharvelue of veriabhes Mies IWS ces, CE Pr 2 Consumer goes prices PC Pr: proBnces gaods prices GDP dhallator: prices of all typer of goods tr = a ne eh sepeth aa Vs prices Ojthe same 7\ loo — ne marketbasket tn tee basegy, is a ieee 7 00 < Base yr Curment 4y, PE on: = e. Goi3) | . rg Gey. TP Keo - Gora) ‘= 8800 a } 538) ‘ Gas) feoa tee £110)Page —.1d Or P; = Nominal x soo Real (2 Qn Nominal: see eeeeteee ee P KlOo Note: ine oe Se = Pye out Be eseru Chorttomin 50 GPs « menu ef ZVCOKOMIC welfare) )) Non-market Aedivitias 2) detsune 3) Smproved product Bina kiby 4) Undsprrin ae Econouy 5 Chimie desrrakehon 6) Composition and Rist bution of oushpet 7) Non-eeonome Sounces of toakfane Finodess, the Lifenence between GDP and NDP 29 prattons (Gre) Pe Depredi “ Q@) = ve ec = C+ caylee, 9 = soe => NDP C+TIptGtkKn = > GDP