and explain each carefully. The expression above depicts two different ways to come up with real GDP for a country. The left side of the expression explains expenditure side of computing real GDP which can be rewritten as: y = c + i + g +x – m In real terms‚ it could be said that real output (y) is equal to real aggregate expenditure (c + i + g + x – m). The right side of the equation depicts how to determine real GDP by the total income all people within a certain economy. This equation is
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Foreign Direct Investment * Tariff * Quota * What are effects of higher exports? (exam tips) * Globalization (descriptive) * Advantages and disadvantages * World Bank * Functions of the IMP * WTO * Aggregate supply and aggregate demand (diagram) * Foreign exchange rate (descriptive and diagram) * Factors contributing to demand – increase (foreign exchange rate – increase) * Inflation rate – decrease * Unemployment rate – decrease * Export
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consumer expenditure expressed are broadly classified under (a) Food total and (b) Non-food total. Value of Consumption: Consumption out of purchase is evaluated at the purchase price. Consumption out of home produce is evaluated at ex-factory prices. Value of consumption out of gifts‚ loans‚ free collection and goods received in exchange of goods and service is imputed at the rate of average local retail prevailing during the reference period (30 days). Monthly Per Capita Consumer Expenditure (MPCE):
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recession and control inflation. It may be defined as a deliberate change in government revenue and expenditure to influence the level of national output and prices. Meaning of Fiscal Policy Fiscal policy is also called Budgetary policy. It is primarily concerned with the receipts and expenditures of the government; it also relates to the study of economic effects of these receipts and expenditures Fiscal policy refers to government policy that attempts to influence the direction of the
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Classical theory of employment The Full employment Model- Some of the aspects of classical theory are more relevant to the conditions prevailing in the developing countries and this theory highlights those factors which govern income and employment in these countries. While the Keynesian theory ------ the role of effective demand in the determination of income and employment. Classical theory-----In a free-market economy there was sufficient demand for the output produced. Classical theory
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government spending and revenue.Fiscal policy can decrease unemployment by helping to increase aggregate demand and the rate of economic growth. The government will need to pursue expansionary fiscal policy‚ this involves cutting taxes and increasing government spending. Lower taxes increase disposable income and therefore help to increase consumption‚ leading to higher aggregate demand.With an increase in aggregate demand‚there will be an increase in real GDP.If firms produce more‚there will be an increase
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= C + G + I + (X – M) Where C is consumption‚ G is government expenditure‚ I is investments‚ X is foreign export revenue and M is foreign import expenditures. According to the aforementioned equation‚ by definition and in summary‚ when the foreign direct investment fall‚ so will the aggregate demand. In order to inject more cash into the local economy‚ the Singapore Government may choose to increase the total government expenditure. A fall in the Ad may be seen in the graph below: Referring
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investment that is less than planned investment. 2. The ratio of the increase in ________ to the increase in ________ is called the multiplier. A) equilibrium nominal GDP; autonomous expenditure B) equilibrium real GDP; autonomous expenditure C) autonomous expenditure; equilibrium real GDP D) induced expenditure; equilibrium real GDP 3. An example of assets that are included in household wealth would be A) stocks‚ bonds‚ and savings accounts. B) stocks‚ loans owed‚ and savings accounts
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confirmed that VAT revenue is significantly different at 99 percent confidence level in relation to GDP. This implies that VAT is not effective as revenue earner‚ in the sense that significant parts of GDP which represent aggregate national income as well as aggregate national expenditure are not collected as tax. Therefore‚ the recommendation by this study includes maintenance of the status quo as it could suggest support to the economy and convenience principles of taxation. Key words: Investigating
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Aggregate Demand and Supply Models Team C Ellen Campbell‚ April 6‚ 2013 Stephen Martin University of Phoenix Introduction Leaning team C is a group of International reporters. The team has the task of describing and critiquing the current state of the U.S. economy. The current state of the following economic factors is: unemployment‚ expectations‚ consumer income‚ and interest rates. Team C will identify the existing effect of the economic factors on aggregate demand and supply. Team will
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