Circular Flow And Measures Of GDP Flashcards
Who are the economic agents in the macro economy
Households
Firms
What do households provide firms
Factors of production
Land
Labour
Capital
Enterprise
What do households receive from firms
Factor incomes
What is the reward for labour
Wages and salaries
What is the reward for land
Rent
What is the reward for entrepreneurship
Profit
What is the reward for capital
Interest
What do households do with factor incomes
Consumer expenditure
What are the leakages
Savings
Taxation
Imports
What are the injections
Government spending
Exports
Investment
What happens to growth if injections are greater than leakages
Economic growth will rise
What happens to growth if injections are less than leakages
Economic growth will be decreasing
What happens to growth if injections are equal to leakages
Neither increasing or decreasing
Macro economic equilibrium
What are methods to work out GDP
Output method
Income method
Expenditure method
Output = income = expenditure
