AAEC 1006: Week 3
AAEC 1006: Week 3 AAEC 1006
Popular in Economics of the Food and Fiber System
Popular in Department
This 2 page Class Notes was uploaded by Shayna M on Sunday September 18, 2016. The Class Notes belongs to AAEC 1006 at Virginia Polytechnic Institute and State University taught by Dr. Mike Ellerbrock in Fall 2016. Since its upload, it has received 8 views.
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Date Created: 09/18/16
AAEC 9/5 Put a price on clean air, this raises the price of electricity. Someone that doesn’t care about the environment would still turn the lights off to save money. As the world shrinks the center will get bigger. The interdisciplinary courses get even more important. All 3 are essential for sustainable development. This is the circular flow of income The solution for poverty around the world is for all poor people to have a job Rainforests for rent? Rainforests in Costa Rica affect weather patterns in Minnesota and Wisconsin, which influences the price we pay for milk and cheese The circular flow of income means we can track money on both sides of the circle Spending = earning/income Every time someone spends $1, someone earns $1 GNP= C +I + G + (x-m) = y GNP= Gross National Product = sum value of all goods and services produced in a country in a year GDP= Gross Domestic Product: if someone in the US owns a company in Italy, it’s in the Italian GNP GNP is a measure of production per year, whether the items are sold at retail value that year or not. This is because the worker’s made their contribution the year it was made and want to be paid. GNP ALWAYS involves money changing hands legally GNP is a measure of production, not quality of life Example: it costs a lot to build a prison, and makes the GNP go up but it doesn’t make the quality of life better GNP doesn’t reflect the quality of the product; the GNP goes up even if the product is junk Green GNP is a movement to include environmental assets in the GNP o If you cut down a tree, how long does it take to grow back? o Indirect methods to estimate cost of things socially