3.1 Measuring Economic Activity Flashcards
National Income
The total value of the final output of all new goods and services produced in a country in one year.
The Output Method
Adds up the value of all final goods and services produced in a country over a period of time
The Income Method
Adds up all income earned by the factors of production in a country over a period of time
The Expenditure Method
Adds up all the spending on final goods and services produced within a country over a period of time
Gross Domestic Product
The total value of goods and services produced in an economy over a period of time, usually one year.
Gross National Income
The total money value of all final goods and services produced in an economy in one year, plus net property income from abroad
(interest, rent, dividends and profit).
Real GDP
measures the value of a nation’s output in a particular year adjusted for changes in the price level from a base year.
Nominal GDP
Measures the value of a nation’s output produced in a year, expressed in the value of the prices charged for that year.
Business Cycle
A diagram showing the periodic/cyclical fluctuations in economic activity.
The business cycle shows that economies typically move through a pattern of economic growth with the phases: recovery, boom, slowdown, recession.
OECD Better Life Index
An index to compare well-being across countries, based on 11 topics that the OECD has identified as essential, in the areas of material living conditions and quality of life.
- Housing
- Income
- Jobs
Happiness Index
An index which is used to measure the collective happiness and well-being of a population.
- GDP per capita
- Healthy life expectancy
- Freedom
Happy Planet Index
An index that combines four elements to show how efficiently residents of different countries are using environmental resources to lead long, happy lives.
The elements are well-being, life expectancy, inequality of outcomes, and ecological footprint.
