Patterns Of Economic Growth Flashcards
GDP
Total value of final goods and services produced within a country’s border over the course of a year
Value Added
Difference between the value of intermediate goods in a production activity and the value of the final goods & services
Real GDP
A measure of an economy’s output adjusted for inflation. The unadjusted figure is referred to as nominal GDP
GNP
The value of the final goods and services produced by domestic factors of production whether at home or abroad
Purchasing Power Parity (exchange rates)
ratio of local currency of a particle basket of goods and services to dollar price of the same basket
Economic Growth
the rate of increase in a country’s average income
Average income is the total value of income earned in any form, from any source by anyone in the country divided by the number of people.
Successful Development requires:
econ growth
reductions in poverty, inequality & vulnerability
What causes rapid economic growth
proximate sources
economic determinants
political determinats
Total Income
the total value of production so the rate of economic growth is positive when aggregate labour productive is rising
Aggregate Labour
the average value of output produced per worker in the economy’s farms, family enterprises, firms and other productions firms.
Proximate Sources
the kinds of change in socioeconomic activity that give rise to economic growth and the related choices through which those changes come about
Economic Determinants
the type of policies, institutions;, external market conditions and other circumstances that are taken as given by people within the socioeconomic system and that affects how willing and able people are to make the choice associated with the proximate resource of growth
Political Determinants
the political conditions that lead policymakers to put good policies and institutions into place
Production Function
The maximum quantity of output that the firm could produce is related to the quantities of production factors it employs
Marginal Product of Labor
Increase in output associated with a one unit increase in the labor while holding capital and the current level of technology (K & A) constant
