曼昆经济学chapter23.ppt

Table 2 Real and Nominal GDP Copyright?2004 South-Western Figure 2 Real GDP in the United States Billions of 1996 Dollars $10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 1970 1975 1980 1985 1990 2000 1995 Copyright ? 2004 South-Western GDP AND ECONOMIC WELL-BEING GDP is the best single measure of the economic well-being of a society. GDP per person tells us the income and expenditure of the average person in the economy. GDP AND ECONOMIC WELL-BEING Higher GDP per person indicates a higher standard of living. GDP is not a perfect measure of the happiness or quality of life, however. Some things that contribute to well-being are not included in GDP. The value of leisure. The value of a clean environment. The value of almost all activity that takes place outside of markets, such as the value of the time parents spend with their children and the value of volunteer work. Distribution of income. Question Why is it desirable for a country to have a large GDP? Give an example of something that would raise GDP and yet be undesirable. Table 3 GDP, Life Expectancy, and Literacy Copyright?2004 South-Western Summary Because every transaction has a buyer and a seller, the total expenditure in the economy must equal the total income in the economy. Gross Domestic Product (GDP) measures an economy’s total expenditure on newly produced goods and services and the total income earned from the production of these goods and services. Summary GDP is the market value of all final goods and services produced within a country in a given period of time. GDP is divided among four components of expenditure: consumption, investment, government purchases, and net exports. Summary Nominal GDP uses current prices to value the economy’s production. Real GDP uses constant base-year prices to value the economy’s production of goods and services. The GDP deflator—calculated from the ratio of nominal to real GDP—measures the level of prices in the economy. Summary GDP is a good measure of econo