2 1 gdP GNP ⊙ Nominal and real gdP Nominal GDP is the sum of the quantities of final goods produced times their current price Real GDP is the sum of the quantities of final goods produced times constant (rather than current) price 友学经济学院
Nominal and Real GDP ❖ Nominal GDP is the sum of the quantities of final goods produced times their current price. ❖ Real GDP is the sum of the quantities of final goods produced times constant (rather than current) price. 2.1 GDP & GNP
21 gdP GNP final goods and services vs intermediate products o Products vs commodities o Market vs non-market 且经济学院7
7 final goods and services vs. intermediate products Products vs. commodities Market vs. non-market 2.1 GDP & GNP
case1 make wine 友学经济学院
case1: make wine
Case2 from wheat to bread Price of Price of intermediate Increment final goods products Wheat 100 0 100 flour 150 100 50 Bread 250 150 100 retail 300 250 50 total 800 500 300
Price of final goods Price of intermediate products Increment Wheat 100 0 100 flour 150 100 50 Bread 250 150 100 retail 300 250 50 total 800 500 300 Case2: from wheat to bread
2 1 gdP GNP o limitation of GDP(GNP) s non-market activities diversity in standard of living Income distribution o Natural resource environment 友学经济学院
limitation of GDP (GNP） ❖non-market activities ❖diversity in standard of living ❖Income distribution ❖Natural resource & environment 2.1 GDP & GNP