Objective 1.02
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Transcript of Objective 1.02
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Objective 1.02
Understand economic conditions
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Measuring Economic Activities
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Gross Domestic Product (GDP)
• GDPis the measurement to determine the country’s overall economic output
(The country’s TOTAL $$ value of goods and services produced in 1 year.)
• Major categories of GDP– Individual spending– Business spending– Government spending– Exports & imports
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Gross Domestic Product (GDP)
• Name some products or services you have purchased or from which you have received benefits.
• Which component of GDP would you classify the product or service you named?
Individual spendingBusiness spendingGovernment spendingExports & imports
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GDP per capita
GDP per capita means output per person
=_________GDP__________Total Population
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Labor Activities
• Unemployment ratePercentage of people in the labor forcewithout jobs.
• Productivity means …– What can help you be more productive in a
computer lab?– What can contribute to employees increasing
their production?
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Consumer SpendingMeasurement of consumer
spending:
• Personal Incomewages, investment income, and government payments
• Retail Salessales of goods and services that indicate spending patterns
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Investment Activities
• The money used for capital projects comes from three main sources:• Personal savings• The stock market• The bond market
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Investment Activities
• Personal Savings- Businesses use money deposited in banks to buy equipment or products.- Savers earn interest on the savings.
• Stock Market- Higher earnings for business increases the business value
- This causes demand for their stock.
• Bond Market- The bond market makes money available for businesses and government to borrow. - Bondholders earn interest on money.
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Investment Activities
• How does each investment activity impact economic growth?
Personal SavingsStock MarketBond Market
• What are some examples of investment activities?
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Borrowing Activities …
• by– Government – Businesses
• How can government borrowing lead to a budget deficit?
• How can using borrowed money wisely impact businesses?
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Measuring Economic Activities
GDP GDP Per capita
Labor ActivitiesConsumer Spending
Investment Activities
Borrowing Activities
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