Economic Terms Flashcards
Net Production taxes
Ex. Land, registration fee
Net Product Taxes
Paid per unit Product. Ex. Excise tax
GDP at Factor Cost
- Reported by CSO. Revised in 2015. Replaced by GVA at Basic Prices
- Most highlighted measure of National Income
GDP at Market Price
- Now most used. Now called GDP only
- C + I + G + X - M
Factor Cost
- Only payment to Factors of Production
- Not include tax
- Market Price - Indirect Taxes
GVA
- GDP - Indirect Taxes
- Help know GDP - Tax link
GVA at Factor Cost
GVA at Basic price - Net production taxes
GVA at Basic Price
- GVA at Basic Price = GVA at Factor Cost + Production Taxes (therefore not include Product Taxes)
- Value of total output produced in economy - Value of intermediate consumption
- GVA (MP) - Net Product taxes
Market Price
MP = Factor cost + Total indirect taxes - Total subsidies
GVA at Market Price
- GVA at Basic Price + Net Product Taxes
- is equal to GDP (MP)
Externalities
Benefits / harm a firm / individual cause to another for which they are not paid / penalized
Private income
Factor Income from NDP to pvt sector + National Debt interest + Net factor income from abroad + Current transfers from govt + Other net transfers from RoW
GDP
aggregate production of final GnS taking place in Domestic Economy during a year
GNP
GDP + Factor income earned by Domestic FoP abroad - FI earned by FoP of rest of world in Domestic economy
NNP
GNP - Depreciation
GDP, GNP and NNP include Taxes?
- Yes, they all include Indirect Taxes as they are calculated at MARKET PRICE
- also include subsidies given by Govt
NNP at factor cost
- Aka National Income
- = NNP at Market Price - net indirect taxes (Indirect tax - subsidies)
Undistributed Profits
Profits earned by Govt and Firms not distributed among Factors of Production
Personal Income
NI - undistributed profits - net interst payments paid by HH - corporate tax + transfer payments to HH by govt and firms
Personal disposable income
Personal income - Personal tax payments - non tax payments
National disposable income
NNP at mkt price + other current transfers from rest of world (gifts, aids)
National Income
NNP at Factor Cost - Indirect Taxes + Subsidies
GDP at Market Price
C + I + G + X - M
GDP at Factor cost
- GDP(atMP) - Net Product Taxes
- GDP(atMP) - Net Indirect Taxes
NDP at Market Price
- GDP (MP) - Depreciation
- allow policy makers calculate how much country has to spend to maintain Current GDP
NDP at Factor cost
NDP (MP) - Net product Taxes - Net Production Taxes
GNP at Market Price
- value of all final GnS product by residents of India and measured at MP in a year
- whether within indian boundary or outside
- GDP (MP) + NFIA
GNP at Factor Cost
- value of output received by FoP belonging to a country in a year
- GNP (MP) - Net product taxes - Net Production Taxes
NNP at Market Price
- How much country can produce in a given time. Output regardless of where production
- GNP (MP) - Depreciation
- NDP (MP) + NFIA
NNP at Factor Cost
- sum of all income earned by all FoP belonging to a country in a year
- NNP (MP) - net product taxes - Net production taxes
- NDP (FC) + NFIA
What is National Product
NNP at Factor cost - not bound by production in national boundaries
Real GDP
- GnS evaluated at constant set of price
- since price fix - if real GDP change = mean volume of Production changing
Nominal GDP
Value of GDP at current prices
GDP Deflation
Nominal GDP / Real GDP
CPI v/s GDP Deflator
- Not represent all GnS produced in country. GDP deflator does
- CPI include price of goods imported. GDP deflator does not
- CPI weights are constant. In GDP deflator they are different, according to Production level
Mercantilism
- Increasing exports. Manipulating Prices
- two types - US and China.
Potential GDP
Max Can produce without inflating economy
Output GDP
actual production
Per Capita Income
GDP or GDP / Mid year population of corresponding year
Approaches to measure GDP
- Expenditure
- Output
- Income
Civic Capital
Citizenry working together to facilitate rights
National Account Statistics
- By CSO in MoSPI
- Estimates = 1st estimate of growth of current year = Advanced Estimate ⇒ Revised to Quick Estimate ⇒ Provisional Estimate ⇒ Final Estimate
Genuine Progress Indicator
- Redefining progress
- Env + social Factors
Big Mac Index
- The Economist
- PPP based
WB Classification
- PCI - Low - 1005 US dollars
- Lower Middle - 1005 - 3955 US dollars
- Upper Middle - 3956 - 12235 US dollars
- High - 12235 US dollars
UN LDC
- PCI > 1035 US Dollars = LDC - eco vulnerable, HR weak
- Review criteria every 3 years
- Currently 47 countries
Betterlife Index
OECD
Commission on Measure of Economic and Social Progress
- Joseph Stilgitz + French govt
- if wealth and social progress can be measured - Alternative to GDP