1. Do Now: What do you already know about GDP?

2.  Gross Domestic Product (GDP)  What is it?

3.  Why is GDP a useful measure?  Measure of economy’s health  “mother of all economic indicators”  Economic growth

4.  How is GDP an imperfect measure?  Consider what is not counted  Volunteer work  improvements in efficiency  qualitative changes (not just quantitative)  Underground economy  Standard of living?  Inflation  Population  Distribution of wealth

5.  Factors Limiting Types of Products Counted  One year  Only final goods and services  Not intermediate  Only goods sold for first time

6.  Adjusting Gross Domestic Product  Current GDP  Money GDP  Deflate with CPI  Why?

7.  Real GDP  Constant Dollars  Base Year  Why?

8.  Per Capita Real GDP  Population  Why?

9.  Is GDP overrated as an expression of our economic well-being? Explain.

10.  Economic Growth  Full Employment  Price Stability

11.  BUSINESS CYCLE  EXPANSION  PEAK  CONTRACTION  TROUGH