econ

• Development


  Sustained increase in the economic standard of living of a country's population by increasing its stocks of physical and human capital and improving its technology
• Characteristics of developing countries

  • Classification
  • Diversity
  • Common characteristics
• Macroeconomics


  The study of the economy as a whole or the basic sectors or aggregates: household, business, government, foreign
• Factors of production


  • Land
  • Labor
  • Capital
  • Entrepreneur
• Factor incomes


  • Rent
  • Wages
  • Interest
  • Normal profit
• Macroeconomic circular flow


  • Household sector
  • Business sector
  • Government sector
  • Foreign sector
  • Leakages
  • Injections
• Measuring national income and output


  • Final expenditure approach
  • Factor income approach
  • Value added from industrial origin approach
• GDP = C + I + G + (X - M)
• GDP = NY + IBT + D
• GDP = A + I + S
• National income


  Sum of all income payments derived from the four factors of production (land, labor, capital, entrepreneur) such as rent, wages, interest, and normal profit
• Normal profit


  Sum of proprietors' income and corporate profits, including corporate income taxes, dividends, and undistributed corporate profits
• Sectors contributing to GDP

  • Agriculture
  • Industry
  • Services
• Real GDP = Current GDP x 100 / CPI
• Real GNI = Current GNI x 100 / CPI
• Indirect business taxes (IBT)

  Taxes on the sales of goods and services, including value added tax (VAT)
• Depreciation


  Cost of the used capital goods in a given period of time, calculated as Gross Investment - Net Investment
• Net primary income from abroad

  Difference between the aggregate flow of factor payments from the rest of the world (inflow of receipts from the use of the economy's resources, e.g. OFW remittances) and the outflow of payments for the economy's use of foreign investments
• Government functions


  • Resource allocation
  • Social services
  • Economic services
  • National defense
  • General administration
  • Debt servicing
  • Resource distribution
  • Income support
  • Redistribution in kind
  • Stabilization
• Sources of government revenues

  • Tax revenues
  • Non-tax revenues
  • Operating and service income
  • Income from public enterprises/investments
  • Sale of assets
  • Grants and aids
  • Borrowings
• Fiscal policies (taxation and expenditures) and monetary policies (to control inflation and manage money supply) are used for government stabilization