2.1

Question 1

private sector

Answer 1

part of economy run by individuals and businesses

Question 2

public sector

Answer 2

part of economy controlled by gov’t

Question 3

factor payment

Answer 3

payment for factors of production

Question 4

transfer payments

Answer 4

when gov’t redistribute income

Question 5

subsidies

Answer 5

gov’t payment to businesses

Question 6

GDP

Answer 6

dollar value of all final goods/services produced within a country in one year

Question 7

expenditure approach

Answer 7

add up all consumption, investment, gov’t spending and net exports

Question 8

income approach

Answer 8

add up all income received by owners of resources

Question 9

what’s not included in a gdp?

Answer 9

1. intermediate goods
2. non-production transaction
3. nonmarket and illegal activities