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Friday, June 12, 2009

foreign trade and national income

Introduction: during any one year period, the economy produces a given value of final goods and services known as the gross national product.national income accounts divide GNP among the four possible uses for wich a country is output is purchased:a) consumption(C): it is the portion of GNP purchased by the private sector to fulfill current wants (i.e. the amount consumed by private domestic residentes).b) investment(I): it is the part of output used by firms to produce future output (i.e. the amount put aside by firms to build new plant and equipment for future production).c) government expenditure.d) current account balance.

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