Transcript social accounting

National Accounting
Ch 1: The nature of the national
accounting.
Ch 2: National Commodities.
Ch 3: The basic concepts of the
national accounting.
Ch 4: Preparing the national
accounts.
Ch 1: The nature of the national
accounting
(1)The definition of
national accounting
Ch 1: The nature of the national
accounting
National accounting as an
accounting branch has been affected
and developed as a result of
sequential development in other
branches, as; the economics,
politics and statistics.
Ch 1: The nature of the national
accounting
National accounting is defined as “
the accounting branch, which aims
at measuring and interpreting the
economic changes and the national
level and indicating to the results of
the national economy to support the
state policies.
Ch 1: The nature of the national
accounting
All public sectors should be presented
in the national accounts, and results
should be available to gained and
support the measurement of the
national performance.
Ch 1: The nature of the national
accounting
(2)The different sectors
of the society
Ch 1: The nature of the national
accounting
Two group sectors represent the main
focus of concern of the national
accounts, as; the state as whole and
the other structured sectors.
Ch 1: The nature of the national
accounting
The other structured sectors include:
(1) The business sector:
This sector includes all entities and units
(firms) which are consuming the factors
of production to produce commodities.
This sector includes all types of firms,
either public or private.
Ch 1: The nature of the national
accounting
(2) The household sector:
This sector includes all consumers of
commodities and services produced by
the previous sector.
In addition to the consumers, this sector
includes also, the non for profit
organization.
Ch 1: The nature of the national
accounting
Sometimes, consumers may represent
a factors of production within the
other factors of the first sector.
Therefore, this group of persons may
be considered as a multi-sector
participants.
Ch 1: The nature of the national
accounting
Examples of this type may includes
employees who work in the first
sector, in the mean time, they will still
remain consumers to the products of
this sector.
Ch 1: The nature of the national
accounting
(3) The Governmental sector:
This sector includes the different ministries
and the local governmental entities,
which offer services free.
Ch 1: The nature of the national
accounting
(4) The rest of the world sector:
This sector includes the different
transactions between the previous three
sectors and the outside world, which
contain mainly imports and exports.
Ch 1: The nature of the national
accounting
(3)The mixed Economy,
Markets, and Politics
Ch 1: The nature of the national
accounting
Mixed economy:
Is one in which government supplies a
considerable amount of goods and
services and regulates private
economic activity.
Ch 1: The nature of the national
accounting
In mixed economies, provision of a
significant amount of goods and
services takes place through political
institutions.
Ch 1: The nature of the national
accounting
Pure market economy:
Is one in which private firms for profit
and all exchanges of goods would
supply virtually all goods and services
which would take place through
markets, with prices determined by
free interplay of supply and demand .
Ch 1: The nature of the national
accounting
In pure market economies,
individuals would be able to purchase
goods and services freely, according to
their tastes and economic capacity.
Ch 1: The nature of the national
accounting
(4)Circular Flow in the
Mixed Economy
Ch 1: The nature of the national
accounting
In pure market economies, all
productive resources are privately owned
by individuals who decide how to use
these resources.
The individual, together with others
living in their households, make
decisions about how to use the resources
they own.
Ch 1: The nature of the national
accounting
Their decisions are influenced in part
by market prices for goods and
services. They offer their resources for
sale as inputs in the marketplaces.
Ch 1: The nature of the national
accounting
 Private business firms are organized to
hire resources in input markets to produce
goods and services desired by household
members.
 The products, In turn, are sold by
businesses to households in output
markets.
Ch 1: The nature of the national
accounting
 In a perfectly competitive market
economy, no seller can influence prices.
 Instead, prices are determined by free play
of the forces of supply and demand.
Ch 1: The nature of the national
accounting
 Given market prices, households decide to
sell the resources they own, and firms
decide which inputs to buy and what
outputs to produce.
 This process is summarized as a simple
circular flow.
Ch 1: The nature of the national
accounting
Ch 1: The nature of the national
accounting
 Let's first look at the relationships that
would exist in the' economy if there
were no governments.
 The lower loop of the diagram represents
the input markets, where households
sell the resources to firms for marketdetermined prices.
Ch 1: The nature of the national
accounting
 The upper loop is the output markets,
where an array of outputs is offered for
sale to households, which, in turn, pay for
them with the dollars earned from the sale
of their members‘ productive resources.
Ch 1: The nature of the national
accounting
 The distribution of income depends on the
distribution of ownership of productive
resources and the prices and other
financial returns the resource owners
receive from employment of those
resources in production.
Ch 1: The nature of the national
accounting
 The figure depicts government activities
in the central portions of the diagram;
Governments purchase inputs from the
households and acquire ownership rights
of such productive resources as land and
capital.
Ch 1: The nature of the national
accounting
 Governments use these inputs to provide
goods and service that are not sold to
households and business firms but are
made available through no market
rationing. However, governments do
sometimes own and operate enterprise.
Ch 1: The nature of the national
accounting
 Governments also purchase outputs of
business firms, such as paper, cars, bricks,
and guns. To pay for them, government
requires businesses and households to
make various payments such as taxes,
charges, and fees.
Ch 1: The nature of the national
accounting
 The government uses the productive
resources it acquires to produce goods and
services including national defense, roads,
schooling, police and fire protection, and
the many other essential services.
Ch 1: The nature of the national
accounting
(5)Objectives of the
National Accounting