《宏观经济学》课程教学资源（英文版）Chapter 2 The Major Macroeconomic Variables

Chapter 2:The Major Macroeconomic ariables 2-1: Aggregate Output 2-2: The other Major Macroeconomic Variables 2003-6-22

2003-6-22 1 Chapter 2:The Major Macroeconomic Variables 2-1:Aggregate Output 2-2:The Other Major Macroeconomic Variables

2-1HAggregate Output GDP Value Added and Income o nominal and real dp 2003-6-22

2003-6-22 2 2-1:Aggregate Output GDP,Value Added,and Income Nominal and Real GDP

GDPVValue Added and Income e There are three ways of thinking about an economys GDP 1. GDP is the value of the final goods and Services Produced in the Economy During a Given Period 2003-6-22 3

2003-6-22 3 GDP,Value Added,and Income There are three ways of thinking about an economy’s GDP 1.GDP is the value of the Final Goods and Services Produced in the Economy During a Given Period

Steel company Revenues from sales $100 Expenses(wages) $80 Profit $20 Car company Revenues from sales $210 EXpenses $170 Wages $70 Steel purchases $100 Profit $40 2003-6-22

2003-6-22 4 Steel company Revenues from sales $100 Expenses(wages) $80 Profit $20 Car company Revenues from sales $210 Expenses $170 wages $70 Steel purchases $100 Profit $40

GDPVValue Added and Income 2, GDP is the Sum of value added in the Economy During a Given Period 2003-6-22 5

2003-6-22 5 GDP,Value Added,and Income 2.GDP is the Sum of Value Added in the Economy During a Given Period

GDPVValue Added and Income e3. GDP is the Sum of incomes in the Economy During a Given Period o Some of the revenues are collected by the government in the form of taxed on sales such taxes are called indirect taxes o Some of the revenues go to pay workers this component is called labor income The rest goes to the firm--that component is called capital income 2003-6-22 6

2003-6-22 6 GDP,Value Added,and Income 3.GDP is the Sum of incomes in the Economy During a Given Period. ⚫ Some of the revenues are collected by the government in the form of taxed on sales— such taxes are called indirect taxes. ⚫ Some of the revenues go to pay workers— this component is called labor income. ⚫ The rest goes to the firm—that component is called capital income

The Composition of/ U.S. GDP by Type of Income (in percent 1960 1998 Labor income% 65 Capital income26% 27% ndirect taxes 8% 8% 2003-6-22 7

2003-6-22 7 The Composition of U.S. GDP by Type of Income (in percent) 1960 1998 Labor income 66% 65% Capital income 26% 27% Indirect taxes 8% 8%

Summarize You can think about aggregate output--about GDP,in three different but equivalent ways From the output side: GDP is equal to the final goods and services produced in the economy during a given period Also from the output side GDP is the sum of value added in the economy during a given period o from the income side gdP is the sum of incomes in the economy during a given period 2003-6-22 8

2003-6-22 8 Summarize You can think about aggregate output--about GDP—in three different but equivalent ways. ⚫ From the output side:GDP is equal to the final goods and services produced in the economy during a given period ⚫ Also from the output side:GDP is the sum of value added in the economy during a given period ⚫ From the income side:GDP is the sum of incomes in the economy during a given period

nominal and real gdP e Nominal GDP is the sum of the quantities of final goods produced times their current price Nomina/ gDP is also called dollar gdp or gdp in current dollars e Real gDP is the sum of the quantities of final goods produced times constant (rather than current) price o Real gdP is also called GDP in terms of goods, GDP in constant dollars, GDP adjusted for inflation, or GDP in 1992dollars--if the year in which real GDP is set equal to nominal GDP is 1992 2003-6-22 9

2003-6-22 9 Nominal and Real GDP Nominal GDP is the sum of the quantities of final goods produced times their current price. ⚫ Nominal GDP is also called dollar GDP or GDP in current dollars Real GDP is the sum of the quantities of final goods produced times constant (rather than current) price. ⚫ Real GDP is also called GDP in terms of goods ,GDP in constant dollars,GDP adjusted for inflation, or GDP in 1992dollars—if the year in which real GDP is set equal to nominal GDP is 1992

2-2; The other Major Macroeconomic ariables The Unemployment Rate ● The inflation rate 2003-6-22 10

2003-6-22 10 2-2:The Other Major Macroeconomic Variables The Unemployment Rate The Inflation Rate