UMass Amherst ECON 104 - Expenditure and Income (2 pages)

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Expenditure and Income

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Expenditure and Income


Explanation behind Expenditure and Income.

Lecture number:
Lecture Note
University of Massachusetts Amherst
Econ 104 - Introduction to Macroeconomics

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Econ 104 11th Edition Lecture 4 Outline of Last Lecture I GDP II Underground Economy III Nominal GDP IV Real GDP Outline of Current Lecture II Expenditure and Income a The Expenditure and Income Approach III Investment IV Circular Flow a Leakages and Injection Current Lecture 1 Expenditure and Income a Your expenditure is someone else s income 2 Expenditure Approach a GDP C I G X M i GDP Consumers Investment Goods Government Spending Net Exports Imports b As GDP C I G X M Supply Demand and Income Expenditure c In Macroeconomics Economists mainly focus on GDP C I G 3 Investment The purchase of new plants factories and equipment to increase inventory buildup 4 Circular Flow Diagram These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute This Circular Flow Diagram was taken from Goggle it corresponds exactly to what was demonstrated in class a Leakages Recession Saving Imports Taxes b Injection Inflation Imports Exports Government Expenditure i If Leakages and Injections are not equal it could either lead to an Injection or Recession 5 Income Approach a GDP NFFI Net Foreign Factor Income GNP Gross National Product Depreciation Consumption of Capital NNP Net National Product Statistical Discrepancy National Income Income earned by Land Labor Capital Indirect Business Tax Cooperate Tax Retained Earnings Social Security Transfer Payments Net Interest Personal Income Personal Income Taxes Disposable Income Although each term wasn t defined in Lecture definitions can be found in the book

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