(BQ) Part 2 book "Essentials of economics" has contents: Unemployment and inflation, long run economic growth, fiscal policy, crises and consequences, monetary policy, aggregate demand and aggregate supply, international trade, capital flows, and exchange rates,.and other contents. | CHAPTER GDP and the CPI: Tracking the Macroeconomy 11 WHAT YOU WILL LEARN IN THIS CHAPTER TH E NE W #2 ❱ How economists use aggregate measures to track the performance of the economy ❱ What gross domestic product, or GDP, is and the three ways of calculating it ❱ The difference between real GDP and nominal GDP and why real GDP is the appropriate measure of real economic activity ❱ What a price index is and how it is REUTERS/Aly Song used to calculate the inflation rate The 2010 economic data showed that China had become an economic superpower, surpassing Japan. e 201 10 o m c da show d that Chin had b me an economic superp er surpassin Japan. data ho o hina cono no p pe rpassi an. an HINA PASSES JAPAN AS Second-Largest Economy.” That was the headline in the New York Times on August 15, 2010. Citing economic data suggesting that Japan’s economy was weakening while China’s was roaring ahead, the article predicted—correctly, as it turned out—that 2010 would mark the first year in which the surging Chinese economy finally overtook Japan’s, taking second place to the United States on the world economic stage. “The milestone,” wrote the Times, “though anticipated for some time, is the most striking evidence yet that China’s ascendance is for real and that the rest of the world will have to reckon with a new economic superpower.” But wait a minute—what does it mean to say that China’s economy is larger than Japan’s? The two economies are, after all, producing very different mixes of goods. Despite its rapid advance, China is still a fairly poor “C country whose greatest strength is in relatively low-tech production. Japan, by contrast, is very much a high-tech nation, and it dominates world output of some sophisticated goods, like electronic sensors for automobiles. That’s why the 2011 earthquake in northeastern Japan, which put many factories out of action, temporarily caused major production disruptions for auto factories around the .
