Assignment 2: What Is Gross Domestic Product?
Go to the following website: www.bea.gov/index.htm Based on the information contained on the website above, answer the following questions:
1. What was Real GDP for 2009? The Real GDP for 2009 was 13,973.7 (NIPA Tables 1.1.5, 2012)
a. What does GDP tell us? The GDP gives information regarding the country’s economy in regards to total money value on all final goods and services that are produced in the economy over any given time frame - annually or quarterly. Real GDP accounts for price changes especially with inflation whereas nominal GDP does not.
b. How did GDP change from 2008? In the first and second quarter, GDP increased. In the third quarter, GDP started decreasing slightly. However, export and imports of goods and services increased slightly. In the fourth quarter, real GDP decreased. Exports, imports, and personal consumption expenditures decreased. Additionally, Federal, national defense and nondefense increased through each quarter. (NIPA Tables 1.1.5, 2012)
c. What caused these changes? The causes for these changes were because of the recession. This was due to a significant decline in economic activity. Additionally, personal consumption expenditures and private investment are down dramatically and real exports of goods and services and real exports of goods and services decreased. Furthermore, government spending has increased. (NIPA Tables 1.1.5, 2012)
What was GNP for 2009? The GNP for 2009 was 14,117.2 (NIPA Tables 1.7.5, 2012)
d. What is the difference between GDP and GNP? GDP (Gross Domestic Product) is the total market value of all goods and services that are produced within the United States borders. GNP (Gross National Product) is the total market value of goods and services produced by labor and property owned by a country regardless of where production took place.
e. How did GNP change from 2008? GNP increased throughout 2008 but started decreasing in 2009. Private , domestic business, and household and
1. What was Real GDP for 2009? The Real GDP for 2009 was 13,973.7 (NIPA Tables 1.1.5, 2012)
a. What does GDP tell us? The GDP gives information regarding the country’s economy in regards to total money value on all final goods and services that are produced in the economy over any given time frame - annually or quarterly. Real GDP accounts for price changes especially with inflation whereas nominal GDP does not.
b. How did GDP change from 2008? In the first and second quarter, GDP increased. In the third quarter, GDP started decreasing slightly. However, export and imports of goods and services increased slightly. In the fourth quarter, real GDP decreased. Exports, imports, and personal consumption expenditures decreased. Additionally, Federal, national defense and nondefense increased through each quarter. (NIPA Tables 1.1.5, 2012)
c. What caused these changes? The causes for these changes were because of the recession. This was due to a significant decline in economic activity. Additionally, personal consumption expenditures and private investment are down dramatically and real exports of goods and services and real exports of goods and services decreased. Furthermore, government spending has increased. (NIPA Tables 1.1.5, 2012)
What was GNP for 2009? The GNP for 2009 was 14,117.2 (NIPA Tables 1.7.5, 2012)
d. What is the difference between GDP and GNP? GDP (Gross Domestic Product) is the total market value of all goods and services that are produced within the United States borders. GNP (Gross National Product) is the total market value of goods and services produced by labor and property owned by a country regardless of where production took place.
e. How did GNP change from 2008? GNP increased throughout 2008 but started decreasing in 2009. Private , domestic business, and household and
References: national income. (2003). Retrieved November 29, 2012, from The American Heritage® Dictionary of the English Language, Fourth Edition: http://www.thefreedictionary.com/national+income National Income. (2007). Retrieved November 29, 2012, from Investments & Income.com: http://www.investmentsandincome.com/income/national-income.html Burea of Economic Analysis. (2012, November 29). Retrieved November 29, 2012, from NIPA Tables 4.2.4: http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1 NIPA Tables 1.1.5. (2012, November 29). Retrieved November 29, 2012, from Bureau of Economics Analysis: http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1 NIPA Tables 1.17.5. (2012, November 29). Retrieved November 29, 2012, from Burea of Economic Analysis: http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1 NIPA Tables 1.7.5. (2012, November 29). Retrieved November 29, 2012, from Bureau of Economic Analysis: http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1 NIPA Tables 2.1. (2012, November 29). Retrieved November 29, 2012, from Bureau of Economic Analysis: http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1 Real GDP by state. (2012, November 29). Retrieved November 29, 2012, from Bureau of Economic Analysis: http://www.bea.gov/iTable/iTable.cfm?ReqID=70&step=1&isuri=1&acrdn=1