@@AjayPatel-so8zs First of all, becoming a lecturer requires you to know how to keep an audience intrigued. Second, most people just go to work to pay the bills, without love or real interest for what they do. They'll usually just do the bare minimum to make it to pay day. He's not alone on the fact that many youtubers make far better teachers than actual "teachers".
Thank you Shamnah! Good luck to you! Econ gets a bad rap. It's fascinating once you dig in. That is, if you like understanding human behavior and the consequences! Best, Roman
using your example, how do the folks calculating GDP know if the eggs were purchased and consumed versus the eggs being purchased to make a finished product?
@@sanctumsomega how does that work exactly? i'm assuming smaller societies buy big quantities of products from bigger societies on a special market, but i might be wrong. can you explain?
This explanation is so broken down, clear and easy to understand and the analogies were spot on. Maybe of this guy was my 12th grade econ teacher, I wouldent have failed with a 58.
People rarely talk about the mindset, internal strategy and emotional perseverance that is involved with financial freedom. It's something I feel like we struggle with as humans because how fast our life moves which makes it so important to be reminded that if we get our mind right and set a goal we can achieve. I own 3 rental properties, I started my own business and my net worth increased by $830,000 in 4 years
You are speaking from your heart and experience and touching directly to hearts and minds. I keep wondering how one could be this successful. I have always been selfish to myself always thinking about others, how they could get better than l'm and still not working on myself. I'm scrambling for a safe place to invest my savings of approximately $46,000
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0:23 - market value of all finished goods and services produced and sold in a year 0:49 - GDP = all the sold goods or services 1:06 We don’t count goods that baker buys in GDP - because those products will go into a finished product that will get sold 1:32 To calculate GDP - we seem to only add up goods sold to consumers (not businesses) 2:17 - if an old house is sold this year - but not produced this year - it does not count towards GDP 2:39 - imports add to countries GDP - so if you buy bottle of wine from France, the sale counts towards France’s GDP
Money making money is not supposed to be counted as GDP. This is what the Glass-Steagall Act was for. "Earning" interest rates is counted as GDP. [After the Glass-Steagall Act was repealed]. A business loan is counted as a business expense. Say if our banks have 75% unsecured bonds on the books. AKA ponzi scheme. That would include GDP. Home flipping is GDP. Now. If this financial ponzi scheme "GDP" stops. The world goes into a resection. Not that building real products ever stopped. Like a stock can go up but the company never sold more products. Yes. Ponzi schemes count as GDP. This is why if the financial system colaspes, it takes the real products with it. This is the Glass-Steagall Act.
Firstly, i wanna thank u for explaining these concepts in a very simplest manner...!!! Now my question is with respect to finished good and intermediate goods..... As you have mentioned if a bakery buys eggs it will not be counted, but if a consumer buys it, it will be counted, so how does the supermarket come to know purpose of buying or i would say how would they come to know if its for commercial use or domestic?
Through store channel i guess, if a retail store is selling than most likely it is for end consumer But if a distributor( distributor are not manufacture) is selling that it will be mostly likely to retailer like super or hyper markets and so on. In Bakery owner product will be on deliverable or reselling. As long as complete Product is delivered to consumer it will be considered. this is my assumption only. so GDP data is collected from 2 points 1 Manufacture 2. point of sales.
@@spartan187 So, would you count cement in the GDP or not ? Cause cement industry is a huge industry but house/building is the finished good here and hence only houses should be counted in the GDP. Wouldn't adding up the numbers of cement industry give an idea of real estate of the country ? Cause counting number of NEW BUILDINGS is a quite a difficult task but as cement industry is dominated by only 3-4 companies here in India, wouldn't it be easy to add up their financials to get an estimate?
I had the same question! What if a baker (or restaurant owner) buys products from a supermarket which are then used in their business to produce a finished good. Seems like the individual products, albeit small in value, would be counted as a finished good at supermarket level and then counted "again" as a finished good at the business level. This example probably doesn't have a "major" effect on GDP, but it's clear GDP is not a perfect number, more like a good estimate of market value.
It is also measured quarterly to see where we are in the economic cycle. Two consecutive quarters of negative (falling) GDP indicates a technical recession.
Value added approach. It takes into account the difference in values of products before and after an operation/production. The good may not be 'finished', but the counting done after that period is only based on the value added after that 'unfinished' product.
What does it mean when a news report says some percent of a country's GDP is debt? Does it mean this many finished goods are produced from borrowed money?
some of the explanation doesn't cover everything for example if a house has been sold a couple of times within a year which price value would be added to gdp
Thank you for all these wonderful videos as i not only ace my exam , i understand the concepts economics and apply them in my everyday life .. Thanks a million.
the video starts saying goods and services produced, then goods and services sold and then again goods and services produced. It's not the same...my question is, if GDP measures goods and services produced (not sold), which information do statisticians gather in order to calculate GDP? Companies' sales +/- inventory variation?
Is it me or do they not teach this shit in school, like you’re just supposed to figure it out yourself. Am I the only one who finds economics so taxing, no pun intended?
Definition doesn't include selling of the product. Suppose a slipper reaches a market then it would be included in GDP only if it gets sold but by definition it should be included as it is produced.
Do the goods have to be necessary sold to be counted in GDP, even without being sold the goods retain its MARKET VALUE right? So imagine a country produces lots of goods and never sells it, will that be counted in GDP, how does that go about? Anyone willing to clarify?
So GDP only counts what's sold? If we produce 10 million computers but only sell 1 million, we only count 1 million? Also, if reports say 3rd quarter GDP rose by +3%, is that in comparison to previous quarter or to previous year's 3rd quarter?
I loved your video so much, thank you for the efoort of making macroeconomics clear and easy to understand! Does anybody else have a problem when trying to enter the practice question website? I do not know why but mine isn”t working.
Guys, your videos are great! Thanks a lot! However I do have a question: The apple computer in your example is actually produced in China but designed in California. So does the finished computer then add on China's GDP or the States' one? Thanks for your answer! Cheers
GDP can be calculated using the incomes generated from the sale of goods and services. So say Apple sells the computer for $1000. Of this 1000, 200$ must be spent on buying the raw materials (processor, etc) from Taiwan. So Taiwan makes 200$ from the sale of this computer, hence Taiwan gets 200$ GDP. These raw materials are then assembled in China into an actual computer, and let's say the Chinese workers who do this get paid 10$. Then the computer would add 10$ to Chinese GDP. However much money is left (790$), is Apple's profit, which counts towards US GDP. All of these numbers are made up but it illustrates how GDP is split between nations.
Can someone explain the polar issue? My teacher says he has listen to this video so many times to teach his classes, but he never understood the polar part.
So, would you count cement in the GDP or not ? Cause cement industry is a huge industry but house/building is the finished good here and hence only houses should be counted in the GDP. Wouldn't adding up the numbers of cement industry give an idea of real estate of the country ? Cause counting number of NEW BUILDINGS is a quite a difficult task but as cement industry is dominated by only 3-4 companies here in India, wouldn't it be easy to add up their financials to get an estimate? Also, What do you do about various schemes, subsidies and stimuli given by the government ? Do you add them while counting the GDP or not ?
The GDP/ Grotesque Domestic Product, factors in monetary exchanges within a measured short period of time; It typically ignores the long-term destruction caused along.
The video is great! Very helpful, thank you! I did not understand only one thing, if for example a country builds a house but it was Not sold within that same year its price would not add up to GDP?
I have a question, why is the tractor considered a finished good when the wheat that the tractor harvested can be made into breakfast cereals, beers, vodka, and breads, so why is it considered a finished good?
do we include sale of animals like horses, camels or say cattle in gdp? Also, if I'm constructing a house for my own use, then at what stage do I include it in Gdp? I was even wondering if plants, trees (bamboo, sandalwood, flowering plants) are included in Gdp?
In the equation GDP = C+I+G+(X-M), does investment 'I' includes inflow of Foriegn direct investment (FDI) ? Does investment 'I' includes spending by domestic businesses only? Does investment 'I' includes spending by foreign businesses in the form of Foreign direct investment (FDI) ?
GDP measures production. If the foreign investment involves a foreigner spending money to build a factory in the country, or something like that, this investment would count towards GDP since something has been produced. But if the foreign investment simply involves a foreigner purchasing a share in a domestic company, then it wouldn't count towards GDP, since nothing has been produced.
Let's say a bunch of houses are built, but are not sold until next year at highly inflated prices. Do we use houseprices in the year of completion to estimate their worth then, or count them next year when sold for the first time?
If a product (for ex a car) is manufactured by an automobile company but not sold. Will it add in GDP for that year? Second question, car was manufactured in 2019 (for example) but sold in 2020. Would it be part of 2019 or 2020?
They showed a iMac which leads me to this question: all the iMacs sold around the world, does that count towards USA’s GDP? Considering Apple is a American company though iMacs are manufactured in China
Does that mean If i own a tyre company and i have two distribution channel, car manufacture and the wholesale, then only the latter one will be account for the GDP calculation?
