Fundamentals Of Macroeconomics And Economic Performance Essay

Fundamentals of Macroeconomics David Smith Eco 372 September 29, 2014 JOSEPH COMPTON Fundamentals of Macroeconomics Every country produces various goods and services. Gross domestic product (GDP) is one of the indicators that display the country’s economic performance. Three approaches are used in the determination of GDP. They include: income approach, expenditure approach, and the product approach. GDP can be referred to as real or nominal GDP (Colander, 2010). When GDP is calculated without putting into consideration inflation factor, then it is referred to as nominal GDP. Adjusting the GDP by taking into consideration the inflation factor, real GDP is arrived at. As a result of the inflation factor, nominal GDP appears higher than real GDP. Unemployment is an indicator of a falling economy. At any given period of time, any economy has a number of people who are unemployed and are actively seeking a paid job. This percentage of the workforce is what is known as unemployment rate. A rising unemployment rate is a cause for alarm because it signifies no promising signs for the economy. The effect is that interest rates decrease as well as inflation rate. A general rise in the average price of goods and services in an economy is referred to as inflation. It is measured as a percentage. A high rate of inflation is an indicator that the economy is growing. There is an increase in GDP and a decrease in unemployment rate. On the other hand, aShow MoreRelatedScience Of Economics By Neuroscientist Marco Iacaboni1074 Words   |  5 Pages4. Mirror neurons are a major component in brain functioning, and thus it gives them a primary role in pscyho-economic reasoning. Their integral nature in decision-making produces various outlying effects like contagion and feeds into instinctual behaviors such as confidence. The neurons, which were popularized within the field of economics by neuroscientist Marco Iacaboni, have since played a big role in discerning group dynamics. 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