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Econ 114 > 2.0: System of National Accounts > Flashcards

2.0: System of National Accounts Flashcards

1
Q

the aggregate total of all final goods and services produced within a country

A

GDP

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2
Q

in what is it assumed first, that all factors of production are owned by households

A

Standard Model

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3
Q

why are only final goods and services included in the standard model

A

to avoid double counting

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4
Q

government buys goods and services from ______ everything is ________

A

firms

privatized

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5
Q

GDP = GDI is an example of an

A

accounting identity

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6
Q

the aggregate earnings of domestic factors of production (capital, labour, and natural resources )

A

GDI

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7
Q

what are the 3 basic concepts of GDP:

A

stocks, flow and equity

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8
Q

a quantity that exists at a moment in time

A

stock

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9
Q

quantity added to or subtracted from a stock

A

flow

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10
Q

refers to the stock of plant, equipment etc.

A

Capital (with respect to GDP)

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11
Q

the decrease in capital stock resulting from wear and tear

A

depreciation

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12
Q

the flow of new capital where gross investment is the total flow of new capital and net is the flow of new capital less depreciation

A

investment

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13
Q

the total flow of new capital

A

gross investment

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14
Q

the flow of new capital less depreciation

A

net investment

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15
Q

refers to the stock of all property

A

wealth (with respect to GDP)

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16
Q

refers to the flow of money earned by supplying factors of production

A

income

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17
Q

refers to gross income minus net taxes

A

disposable income (respect to GDP)

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18
Q

disposable income spent on final goods and services

A

consumption (respect to GDP)

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19
Q

disposable income minus consumption

A

savings (respect to GDP)

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20
Q

the total earnings of households for supplying factors of production to firms and other countries including profits and dividends

A

GDI

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21
Q

refers to income (Y) - Net Taxes

A

disposable income (respect to GDI)

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22
Q

total spending by households for goods and services produced by firms

A

consumption (respect to GDE)

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23
Q

Income (Y) - disposable income (Yd)

A

savings (respect to GDE)

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24
Q

earning of firms from sale of sales of goods and services and financial transactions to gov. and other countries

A

revenue (respect to GDI)

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25
Q

expenditures by firms for depreciation, new plant, etc. paid out of savings

A

investment (respect to GDE)

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26
Q

total taxes minus transfers from gov. to households

A

net taxes (respect to GDI)

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27
Q

goods and services purchased from firms, foreign and domestic

A

government expenditures

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28
Q

NT - G = 0

A

balance

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29
Q

NT - G > 0

30
Q

NT - G < 0

31
Q

accumulated deficits minus surpluses

32
Q

Net exports (NE) =

A

exports (X) - imports (M)

33
Q

NE > 0

A

trade surplus

34
Q

NE < 0

A

trade deficit

35
Q

GNE (Ye) (gross national exports) =

36
Q

household earnings for supplying factors of production to firms (including profits/dividends spent on C+S+T)

37
Q

identity: Yi =

A

C+S+T = Ye = C+I+G+NE

38
Q

income not spent on domestically produces goods/services

39
Q

leakages include

A

savings, taxes and imports

40
Q

expenditure by firms, government and exports

A

injections

41
Q

injections are represented by the formula

42
Q

leakages are represented by the formula

43
Q

injections must equal

44
Q

3 ways you can measure GDP

A

expenditure, factor income, and value added

45
Q

3 types of expenditures

A

personal expenditures, gov. expenditures, and exclusions

46
Q

examples of business investments

A

plant and equipment:

  1. new residential housing
  2. inventories of raw materials
  3. semi-finished products
  4. unsold final products
47
Q

government expenditures on goods and services exclude

A

transfer payments

48
Q

why are intermediate goods/services excluded from measuring GDP

A

to avoid double counting

49
Q

income received from factors of production

A

factor income

50
Q

2 examples of expenditures that are excluded from GDP

A
  1. intermediate (producer) goods

2. used/second-hand goods

51
Q

GDP is calculated by summing up the ______ by each agent that excludes the cost of _____

A

value added

inputs

52
Q

GDP =

A

NDP + depreciation or capital consumption

53
Q

NDP =

A

GDP - depreciation of capital goods

54
Q

are collected by Statistics Canada using the Census and surveys

A

expenditure data

55
Q

collected by Revenue Canada using tax data

A

income numbers

56
Q

how do you measure the real GDP

A

calculate the aggregate price level

57
Q

the average for the prices of all goods and services included in GDP

58
Q

measures the average level of prices of goods and services purchased by typical Canadian family

A

Consumer price index (CPI)

59
Q

CPI uses a _____ to calculate the cost of a typical _________

A

base year

basket of goods and services

60
Q

CPI calculates the cost of base year basket in subsequent years to determine

A

change in price level

61
Q

CPI =

A

current cost of basic/base period cost x 100

62
Q

measures the average level of prices of all goods and services in GDP

A

GDP deflator

63
Q

is valued in current year prices

A

nominal GDP

64
Q

is valued in base year prices

65
Q

advantage of GDP deflator over CPI is

A

GDP is not based on fixed basket of goods and services

66
Q

CPI is often used for cost of living adjustments showing changes in the

A

purchasing power of money

67
Q

used to measure the real growth of the overall economy

A

GDP deflator

68
Q

CPI suffers from 3 technical biases that are not reflected in the base basket

A
  1. substitutions
  2. new goods (innovations)
  3. quality change in good/service
69
Q

with multi- or trans-national corporations there is the problem of i

A

intra-corporate transfer pricing

70
Q

the emerging problem affecting calculation of real GDP

A

the knowledge-based/digital economy

71
Q

total taxes minus transfers from gov. to households

Econ 114 (7 decks)

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