Tutor profile: Georgia C.

5 + (8-6)^2 x 12 =

BEDMAS = brackets, exponents, multiplication, addition, subtraction (8-6) = 2 2 ^2 = 4 4 x 12 = 48 5 + 48 = 53

What is the difference between nominal and real GDP?

Nominal GDP - value of all finished goods produced within a country at CURRENT prices. Real GDP - value of all finished goods produced within a country at CONSTANT prices. Real GDP shows the changes in production of finished goods, as it excludes the effects of changes in prices. Nominal GDP includes the effect of prices, meaning that a change in nominal GDP could be due to a change in prices and no change in goods produced, or vice versa. Real GDP is a more accurate measure of growth in an economy, as it excludes the effects of inflation.

What is the Economic Entity Assumption of Accounting?

The Economic Entity Assumption states that ALL transactions of the business are to be kept separate from ALL personal transactions of the owner. For LEGAL purposes the business and the owner are treated as one entity, however for ACCOUNTING purposes they must be kept separate.