W1P1 - NotebookLM Flashcards
How can GDP be constructed?
GDP can be constructed in three ways: as the sum of value added, the sum of final users, or the sum of the total generation of income in the economy.
What is the difference between flow and stock variables?
Flow variables, like GDP, are measured over a period, while stock variables are measured at a point in time.
What is the difference between GDP and GNI?
GDP measures everything produced within a country’s borders, while Gross National Income (GNI) measures everything produced by a country’s residents, regardless of location.
What are some limitations of using GDP as a measure?
GDP ignores voluntary work and the informal sector, doesn’t account for sustainability, income distribution, or ethics, and may not accurately reflect happiness or illegal activity.
What are the components of GDP?
GDP consists of consumption spending, investment spending, government spending, and net exports.
How is GDP calculated as the sum of final sales?
By taking all the goods that are produced in the economy multiplied by the individual price and adding them up.
Are used goods included when calculating GDP?
No, used goods are not included.
What is the value-added method of calculating GDP?
It looks at the intermediate value added at each step of the production process.
What are imputed rental values?
They are used to account for the value derived from owning and living in a house.
What is the difference between nominal and real GDP?
Nominal GDP is calculated using current prices, while real GDP uses constant prices from a base year to reflect changes in quantities only.
What is chain weighting?
It is used to address price variations and reweight the shares of goods for each period when calculating real GDP.
