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There Are a Number of Measures of Aggregate Economic Activity

question 3

Essay

There are a number of measures of aggregate economic activity, such as GDP, GNP, national income, personal income, and disposable personal income. Each of these measures can be a good indicator depending on the issue under consideration. For each of the following issues,
give your reasons for selecting one of the measures just mentioned as the best indicator to use in studying the issue:
a. the proportion of income households save;
b. the relative share of earnings going to labor versus capital;
c. the total output of new final goods and services.


Definitions:

Demand Estimation

The process of determining the expected demand for a product or service, considering various market conditions and factors.

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