GROSS DOMESTIC PRODUCT Mr. Park Econ ERHS. What is GDP? Gross Domestic Product.

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Presentation transcript:

GROSS DOMESTIC PRODUCT Mr. Park Econ ERHS

What is GDP? Gross Domestic Product

What is GDP? Gross Domestic Product GDP is considered to be the best indicator of determining the health of the economy of a country Serves as the primary measure of the size and strength of an economy Gross Domestic Product measures the market value of all final goods and services produced in the United States during a given time period, usually one year.

What counts towards GPD? Only the value of final goods and services.

Calculating GDP GDP = C + G + I + NX

Calculating GDP Consumption (Haircuts, airline tickets, soup, furniture) – 67%(C) Investment (New physical capital) (I) Government Purchases (spending by all levels of government for goods and services) (G) Net exports minus net imports (NX)

GDPP GDP Per Capita Take the GDP of a country and divide it by the number of people living in the country Accurate? Potentially Misleading?