View Full Document

18 views

Unformatted text preview:

Preview National income accounts measures of national income measures of value of production measures of value of expenditure National saving investment and the current account Balance of payments accounts Copyright 2006 Pearson Addison Wesley All rights reserved 12 1 National Income Accounts Records the value of national income that results from production and expenditure Producers earn income from buyers who spend money on goods and services The amount of expenditure by buyers the amount of income for sellers the value of production National income is often defined to be the income earned by a nation s factors of production Copyright 2006 Pearson Addison Wesley All rights reserved 12 2 National Income Accounts GNP Gross national product GNP is the value of all final goods and services produced by a nation s factors of production in a given time period What are factors of production workers labor physical capital like factories and equipment natural resources and other factors that are used to produce goods and services The value of final goods and services produced by US labor capital and natural resources are counted as US GNP Copyright 2006 Pearson Addison Wesley All rights reserved 12 3 National Income Accounts GNP cont GNP is calculated by adding the value of expenditure on final goods and services produced There are 4 types of expenditure 1 Consumption expenditure by domestic residents 2 Investment expenditure by firms on plants equipment 3 Government purchases expenditure by governments on goods and services 4 Current account balance exports minus imports net expenditure by foreigners on domestic goods and services Copyright 2006 Pearson Addison Wesley All rights reserved 12 4 Copyright 2006 Pearson Addison Wesley All rights reserved 12 5 National Income Accounts GNP cont Copyright 2006 Pearson Addison Wesley All rights reserved 12 6 U S Investment and its components 2000 Billions of 1996 dollars 1750 PT 1970 2002 PT PT P T P 1500 1250 1000 750 500 250 0 250



Access the best Study Guides, Lecture Notes and Practice Exams

Loading Unlocking...
Login

Join to view ch_12 and access 3M+ class-specific study document.

or
We will never post anything without your permission.
Don't have an account?
Sign Up

Join to view ch_12 and access 3M+ class-specific study document.

or

By creating an account you agree to our Privacy Policy and Terms Of Use

Already a member?