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Lecture Comments (4)

1 answer

Last reply by: Professor Jibin Park
Fri Apr 8, 2016 10:23 PM

Post by Acme Wang on April 7 at 04:47:37 AM

Hi Professor,
I want to ask you several questions.
1. what is optimal consumption bundle? two goods that have the same marginal utility per dollar? Or the best purchasing way?
2. what does aggregate spending and intermediate goods separately mean?
3. GDP means the toal value of all final goods and services produced in a economy in a given year. But when we count the value of GDP, why could we use the method that adds up aggregate SPENDING on domestically produced final goods and services? Does spending and production total value the same???
4. What does factor income mean? I know factor income means wages, interest, rent and profit. But I still don't know the true meaning of 'factor income' and why could we use this 3rd method to calculate GDP?
5. And what is the base year?

P.S. I really like your lectures and they are SUPER HELPFUL! Thank you very much!



1 answer

Last reply by: Professor Jibin Park
Wed Apr 29, 2015 12:54 PM

Post by Kim Gyu Min on April 27, 2015

I have a question about Real GDP per capita

REAL GDP/Population of a certain country

so if a country x has REAL GDP OF $100000 and population of 1000
Real GDP per capita will be $100? Thank you.

Gross Domestic Product

  • The macroeconomics equation is as follows: Y = C + I + G + NX
  • Y represents real GDP
  • C = Consumer expenditures
  • I = Business Investment
  • G = Government purchases
  • NX = Exports – Imports
  • The Circular Flow Diagram provides a simplified view of how an economy operates.
  • There exists three different ways of calculating the GDP
  • Nominal GDP uses current prices; real GDP uses constant prices
  • Real GDP is a more accurate means of measuring the health of the economy than is the nominal GDP
  • GDP per capita is the most common measure used to determine a nation’s standard of living

Gross Domestic Product

Lecture Slides are screen-captured images of important points in the lecture. Students can download and print out these lecture slide images to do practice problems as well as take notes while watching the lecture.

  • Intro 0:00
  • Lesson Overview 0:27
  • National Accounts 1:20
    • National Income and Product Accounts
    • Macroeconomist Equation
  • Circular Flow of the Economy 9:23
    • Household
    • Firms
    • Product Market
    • Factor Market
  • Expanded Circular Flow Diagram 22:26
  • GDP Explained 30:36
    • Gross Domestic Product
    • First Method of Calculating
    • Second Method
    • Third Method
  • Real vs. Nominal GDP 36:21
    • Nominal GDP
    • Real GDP
    • Which is a More Accurate Means of Measuring Economic Growth
  • Real GDP Example (2010 Base) 39:08
  • Real GDP Per Capita 47:36
    • Real GDP Per Capita
    • Imperfect Measure but Generally Best Measure of Standard of Living