GDP
Expenditure Approach: add up all the spending on final goods and services produced in a given year
Formula= C+Ig+G+Xn
Income Approach: add up all the income that resulted from selling all final goods and services produced in a given year
Formula= Willy RIP + statistical adjustments
(w= wages but may be stated as "salaries, salary supplement or compensation of employees)
(r=rent, "rental income")
(i=interest, "interest income" ; stocks not included)
(p=profits, from entrepreneur prespective, or proprietor's income)
expenditure is reliable, income not as reliable
Trade formula=exports-imports
negative: deficit
positive: surplus
Budget formula= government purchases of goods and services+government transfer payments-government tax and fee collections
positive: deficit
negative: surpluss
National Income=
1st option: compensation of employees+rental income+interest income+proprietors income+ corporate profits
2nd option: GDP-indirect (business taxes)- depreciation (consumption of field capital) -net foreign paymemt
Disposable Personal Income= national income-personal household tax+government transfer payments
Net national product= GNP-depreciation
Net domestic product= GDP-depreciation
Gross National Product= GDP+net foreign factor payment
Gross Product Domestic Investment=Net Private+Domestic Investment+Depreciation
Formula= C+Ig+G+Xn
Income Approach: add up all the income that resulted from selling all final goods and services produced in a given year
Formula= Willy RIP + statistical adjustments
(w= wages but may be stated as "salaries, salary supplement or compensation of employees)
(r=rent, "rental income")
(i=interest, "interest income" ; stocks not included)
(p=profits, from entrepreneur prespective, or proprietor's income)
expenditure is reliable, income not as reliable
Trade formula=exports-imports
negative: deficit
positive: surplus
Budget formula= government purchases of goods and services+government transfer payments-government tax and fee collections
positive: deficit
negative: surpluss
National Income=
1st option: compensation of employees+rental income+interest income+proprietors income+ corporate profits
2nd option: GDP-indirect (business taxes)- depreciation (consumption of field capital) -net foreign paymemt
Disposable Personal Income= national income-personal household tax+government transfer payments
Net national product= GNP-depreciation
Net domestic product= GDP-depreciation
Gross National Product= GDP+net foreign factor payment
Gross Product Domestic Investment=Net Private+Domestic Investment+Depreciation
In addition to all of the formulas that you have listed, it would be extremely beneficial to include what GDP actually is. By definition, GDP is the total market value of all final goods and services produced within a country's borders within a given year. It would also be helpful to talk about what is not included in the calculation of GDP, such as used/"second-hand" goods, gift/transfer payments, stocks & bonds, unreported business activities, illegal activities, intermediate goods, and non-market activities.
ReplyDeleteI liked how you explained what the income and expenditure approach was but don't forget that all you have to do to solve the income approach is transfer the expenditure approach over to the income side because its the exact same thing.
ReplyDelete