GDP

Question 1

What are intermediate goods?

Answer 1

Goods used in making the final good or service

Question 2

What is GDP

Answer 2

Gross Domestic Product is defined as the total market value of all final goods and services produced in an an economy during a period of time

Question 3

What is economic growth?

Answer 3

Economic growth is defined as an increase in the productive capacity of the economy. In other words it is the increase in Gross Domestic Product of a country over time.

Question 4

What is real GDP?

Answer 4

Real GDP is the GDP of a nation after taking away the effects of inflation.

Question 5

What happens if economic growth is slow?

Answer 5

the economy may not be able to fully employ its resources, especially labour. Unemployment will increase higher than desirable.

Question 6

What is nominal GDP?

Answer 6

Nominal GDP which is the raw GDP value, without taking away the effects of inflation

Question 7

What is desirable economic growth?

Answer 7

3-4%

Question 8

What happens if economic growth happens to fast?

Answer 8

inflation will build as demand for goods and services grows faster than the capacity of the economy to provide them.

Question 9

How is economic growth measured?

Answer 9

Most commonly is measured by changes in the level of real GDP