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EDUCATION: An increase in the knowledge or skills processed by people. Education is generally view from a "formal" perspective, in which "students" sit in classrooms attuned to enthralling lectures from teachers before they are forced to reveal their education through exams. Education, however, can be much less formal, acquired on the job or through the real word experiences. An important economic aspect of is how it enhances the productivity of labor by increasing human capital. Education, in fact, has been one of the prime sources of economic growth and improved living standards.
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Lesson 10: Gross Domestic Product | Unit 1: Measuring Production
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Page: 3 of 25
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Topic:
Final Goods and Services
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A second phrase to highlight is 'final goods and services'.- Production generally involves several intermediate steps which involves market exchanges of intermediate goods. GDP measures only the market value of final goods.
- The cost of intermediate goods is already included in the price and thus the market value of finished product when sold to final users.
- To avoid double counting, GDP does not separately include the market value of any intermediate goods.
Final goods are those reaching their final user and include: household consumption, business investment in capital, government purchases, and exports.
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MARGINAL PROPENSITY TO SAVE The proportion of each additional dollar of household income that is used for saving. The marginal propensity to save (abbreviated MPS) is another term for the slope of the saving line and is calculated as the change in saving divided by the change in income. The MPS plays a central role in Keynesian economics. It quantifies the saving-income relation, which is the flip side of the consumption-income relation, and thus it reflects the fundamental psychological law. It is also a critical to the multiplier process. A related saving measure is the average propensity to save.
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A lump of pure gold the size of a matchbox can be flattened into a sheet the size of a tennis court!
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"Man is born to live, not to prepare for life. " -- Boris Pasternak, writer
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AGI
Adjusted Gross Income
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