01 Giới thiệu về lập trình Python và các công cụ lập trình ntdat qnuslide MACROECONOMICS Lecturer MSc Nguyen Thi Thuy Dung Chapter 2 Macro Indicatiors Measurement • Definition of gross domestic produc[.]
MACROECONOMICS Lecturer: MSc Nguyen Thi Thuy Dung Chapter 2: Macro Indicatiors Measurement • Definition of gross domestic product (GDP) • Measuring gross domestic product • Differences between real GDP and nominal GDP • Definition of consumer price index (CPI) • How to measure CPI and calculate inflation rate • Adjust the macro variables for inflation I What is GDP? • Video: https://youtu.be/mjJmo5mN5yA • Gross domestic product (GDP) is the market value of all final goods and services produced within an economy in a given period of time (Mankiw, 2009) • GDP is also the total expenditure on all final goods and services produced within a country in a given period of time • GDP is also the total income earned from all productive activity in the domestic economy What is GDP? • GDP is the market value … GDP measures all goods in terms of their market value, in the common unit of dollars (or VND) “You can’t compare apples and oranges.” If an apple costs twice as much as an orange, then it contributes twice as much to GDP Non‐market activities like leisure, housework, and child care, seftconsumption don’t contribute to GDP • … of all … GDP accounts for all goods and services that are legally produced and sold in the market GDP does not take into account illegal goods and services What is GDP? • final goods and services… Final goods are those goods sold to their final users Goods that disappear in the process of the production of some other for-sale good are called intermediate goods - A pencil is a final good because, once produced, it is ready for use by its final users - The wood and the other materials that disappeared in the pencil are not final goods Since the value of the final good reflects the value of the intermediate good, only the value of the final good is included in GDP to avoid double‐counting • … goods and services … Goods include cars, food, clothing, etc Services include haircuts, medical care, etc What is GDP? • produced … GDP only includes newly produced goods Buy a new car, that contributes to GDP Buy a used car, that does not contribute to GDP So the sale of used goods is not included as part of GDP … within a country … Vietnam’s GDP counts all goods and services produced in the Vietnam A Vietnamese works in the US; her income counts in US GDP A US citizen works in Vietnam; his income does not count in US GDP … in a given period of time Usually within a quarter (3 months) or a year Methods of measuring GDP Method 1: GDP is the market value of the final goods and services produced by the economy during a given period (expenditure method) Method 2: GDP is the sum of incomes in the economy Method 3: GDP is the sum of valued added produced… • All three measures yield the same total, gross domestic product (GDP) The expenditure components of GDP GDP = C + I + G + NX • Where •C •I •G • NX (IM)) = consumption expenditures = investment expenditures = government expenditures = net exports (exports (X) – imports The expenditure method •Consumption (C): •The spending by households on goods and services, with the exception of purchases of new housing •Investment (I): •The spending by firms on capital equipment (machines and tools), inventories (goods produced but not yet sold), and structures (factories, office buildings including new housing) Note that inventory accumulation is counted as investment: If Ford produce a $50,000 car in 2007, but the car sits in inventory through the end of the year, GDP and investment both rise by $50,000 in 2007 Then, if the car is sold in 2008, consumption rises by $50,000 but investment falls by $50,000, since Ford’s inventory is depleted GDP remains unchanged The car adds to GDP during the year it is produced, not during the year it is sold The expenditure method • Government Purchases (G): • The spending on goods and services of government including salaries of public servants, purchases of weapons for the military and any investment expenditure • Does not include transfer payments (unemployment insurance payment, subsidies) because they are not made in exchange for currently produced goods or services • Net Exports (NX): • Exports: purchases of domestically (VN) produced goods by foreigners • Minus imports: purchases of foreign goods by VN households and firms