|Learning Objectives: Calculate foreign exchange. Understand Balance of Payments.|
|Group activity: Josko Joras (A), December 2012
For an open economy
GDP = C + I + G + (X – M).
However it’s important to realise that imports don’t subtract from GDP.
Read more about the Big Mac index at The Economist. For more on how Argentina games it, see:
- “Argentina likely manipulating Big Mac prices to keep inflation seemingly lower“, Public Radio International, February 7th 2012
Here’s an intro to Balance of Payments:
|These resources form part of my Managerial Economics course map. You can watch the full YouTube playlist here. This page ties into Chapter 10 (Sections 10.2 and 10.3) of ‘Economics: A Complete Guide for Business‘.|