1. GDP to PI

2. GDP=C + Ig + G + Xn  C is usually 67-70% of GDP  Xn is usually a negative number  C is the key to growth

3. Going from GDP to PI numbers:  GDP minus Consumption of Fixed Capital (CFC or Depreciation) will equal:  NDP (Net Domestic Product)  NDP minus Indirect Business Taxes, minus “Net Foreign Factor Income” (if this is a negative number) will equal:  NI (National Income)

4.  NI minus social Security contributions (Payments), minus Corporate Income Taxes, minus “Undistributed Corporate Profits”, plus transfer payments received by citizens will equal:  PI (Personal Income)  PI minus Personal Taxes Paid equals:

5.  DI (Disposable Income)  DI minus Savings equals  C (Consumption)

6. Notes :  Indirect Business Taxes: Sales Taxes Excise Taxes Licenses

7.  Net Foreign Factor Income: Money US citizens earn overseas and send back to the US versus money foreigners earn here and send back to their home countries (remittances)

8.  Undistributed corporate profits: Total corporate profits minus corporate taxes paid and minus any money paid to stockholders in the form of dividend payments

9.  Transfer Payments: Social Security Payments, Unemployment compensation payments, welfare payments, disability payments

10.  Where do credit card expenditures and payments fit in?????