| A | B |
|---|
| National Income Accounting | Measures the economy’s overall performance and other related variables for the nation as a whole. |
| Gross Domestic Product | The total market value of all final goods and services produced in within the boundaries of the US in a given year. |
| Final Goods | Good and services that are purchased for final use by the consumer, not for resale or for further processing or manufacturing. |
| Multiple Counting | Wrongly including the value of intermediate goods in the GDP; counting the same good or service more than once. |
| Value added | The market value of a firm’s output less the value of the inputs the firm has bought from others. |
| Expenditures Approach | The method that adds all expenditures made for final goods and services to measure the GDP. |
| Income Approach | The method that adds all the income generated by the production of final goods and services to measure the GDP. |
| personal consumption expenditures (C) | The expenditures of households for durable and nondurable consumer goods and services. |
| Gross private domestic investment (I) | Expenditures for newly produced capital goods (such as machinery, equipment, tools, and buildings) and for additions to inventories |
| Government Purchases | )- Expenditures by government for goods and services that government consumes in providing public goods and for public (or social) capital that has a long lifetime; the expenditures of all governments in the economy for those final goods and services. |
| net exports | Exports minus imports |
| taxes on production and imports | A national income accounting category that includes such taxes as sales, excise, business property taxes, and tariffs which firms treat as a cost of producing a product and pass on (in whole or in parts) to buyers by charging a higher price. |
| national income | Total income earned by resource suppliers for their contributions to GDP plus taxes on production and imports; the sum of wages and salaries, rent, interest, profit, proprietors’ income, and such taxes. |
| consumption of fixed capital | An estimate of the amount of capital worn out or used up in producing the GDP; also called depreciation. |
| net domestic product | )- GDP minus depreciation |
| personal income | The earned and unearned income available to resource suppliers ad others before the payment of personal taxes. |
| disposable income | )- Personal income less personal taxes; income available for personal consumption expenditures and personal saving. |
| nominal GDP | the GDP measured in terms of the price level at the time of measurement. |
| real GDP | Gross Domestic product adjusted for inflation |
| price index | An index number that shows how the weighted avarage price of a market basket of goods changes over time |
