# Shared Flashcard Set

## Details

ECON 4020 002 EXAM 1: Ch 1 & 2
ECON 4020 002/U of U/ Bilginsoy/ Spring 2008
19
Economics
02/02/2008

Term
 Calculate net domestic national product (NDP)
Definition
 NDP = GDP - depreciation
Term
 Calculate national income (NI)
Definition
 NI = NDP - indirect taxes + subsidies to enterprises
Term
 Calculate personal income (PI)
Definition
 PI = NI - SS contributions - net corporate income - net corporate taxes + transfers to households(where transfers to households = transfers to households and enterprises - subsidies to enterprises)
Term
 Calculate personal disposable income (PDI)
Definition
 PDI = PI - personal taxes - fines and fees
Term
 Calculate consumption (C)
Definition
 C = PDI - household savings
Term
 Calculate government purchases
Definition
 Government purchases = consolidated gov. purchases + gov. income - transfers(where gov. income = taxes + ss contributions + fines and fees)
Term
 Calculate primary current account balance
Definition
 Primary CA = GDP - absoption(where absorption = C + I + G)
Term
 Calulate overall current account balance (CA)
Definition
 CA = Primary current account surplus + surplus on net factor income + surplus on unrequited transfers(Per in class notes: CA= X-Z= Y-A)???
Term
 Calculate GDP deflator
Definition
 (Nominal GDP/Real GDP)*100
Term
 Calculate GDP
Definition
 Y= C+S+T= C+I+G+(X-Z)
Term
 Define recession
Definition
 When output declines for 2 consecutive quarters or more.
Term
 Define growth recession
Definition
 When there is growth, but not enough to keep up with population. So unemployment increases.
Term
 Define coordination failure
Definition
 When markets don’t work (in the macro environment) i.e. when unemployment is high so firms produce less (and need less workers) because ppl are consuming less (b/c they don’t have a job).
Term
 What is the difference between a flow variable and a stock variable?
Definition
 Flow is measured over time (ex. hourly wage) and stock is measured at a point in time (ex. savings at a particular moment in time, national debt)
Term
 Calculate "macro balances"
Definition
 Macro balances: (S-I)+(T-G) = (X-Z)
Term
 Calculate GDP gap
Definition
 (Y-YP/YP)*100
Term
 Calculate real GDP
Definition
 Real GDP = (base year Q)(current year P) + (base year Q) + current year P)....
Term
 Calculate CPI
Definition
 CPI: (current year P)(base year Q) + (current year P + base year Q)...
Term
 Calculate GDP delfator inflation
Definition
 GDP deflator inflation = nominal GDP groth rate - real GDP growth rate
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