Economic Measurements Archives

Economic Measurements

Per Capita Definition

Per Capita Definition

Per capita originates from the Latin language – meaning ‘by head’, or ‘per person’. In economics it is used primarily with GDP to find measurements such as GDP per capita, real GDP per capita, GDP (PPP) per capita, and Gross National Income (GNI).

Price Elasticity of Demand Definition

Price Elasticity of Demand Definition

Price Elasticity of Demand (PED) measures how customers change their behaviour when prices change. In other words, it refers to the relationship between price and demand, and how demand reacts when prices change.

Aggregate Demand Definition

Aggregate Demand Definition

Aggregate demand refers to all the goods produced and brought within the economy. Economists calculate this using values at a specific point in time. In other words, the monetary value of the exchange is registered over the course of a month, quarter, or year.

Nominal GDP Definition

Nominal GDP Definition

Nominal GDP is the total economic output of a nation using current prices. In other words, it is the measurement of all the goods and services a country produces, in prices, at the time they are made.

Causes of Inflation

Causes of Inflation

There are two main types of inflation in economics. They are cost-push and demand-pull inflation. Cost-push inflation looks at the supply side of goods. So anything that would affect the price for the good in order for it to reach the market. By contrast, demand-pull inflation looks at the demand side. So anything that affects the price after it has reached market.

what is gdp

What is GDP?

GDP stands for Gross Domestic Product. On its own, it may not make much sense. However, when
we split it down, the naming becomes clearer. Let us first start with ‘Gross’. It has various
meanings, but in the case of GDP, it is used as a noun. This has a meaning of ‘Complete Amount’.

What is Real GDP definition formula vs nominal GDP

Real GDP Definition

Real GDP is Gross Domestic Product (GDP) that accounts for inflation or deflation. In other words, it disregards the impact that higher prices have played in economic growh and allows us to compare the quantity of goods produced rather than the value.

GNP Definition

Gross National Product Definition

Gross National Product (GNP) refers to the total value of goods and services where the means of production is owned by domestic residents. It calculates the GDP of the country, plus any income that domestic residents receive on investments abroad, but minus any income foreign residents receive on domestic investments.