necessary step in learning how macroeconomic variablessuch as the economy's total output, the price level, the level of employment, interest rates, and other variables are determined. The national income accounts provide regular estimates of GROSS DOMESTIC PRODUCT (GDP), the basic measure of the performance of the economy in producing goods and services. They are also useful because they provide a conceptual framework for describing the relationships among three key macroeconomic variables: output, income,and spending.