GDP Full form – What Does GDP Stand for
In short GDP Full Form is “Gross Domestic Product”.
In detail, GDP is an abbreviation for Gross Domestic Product. It is the total market value of all goods and services which is produced within a country in a specific period of time. GDP is a measurement that the government used to measure the size of an economy and also overall growth or decline in the economy of a nation.
How to calculate GDP (Gross Domestic Product)?
The CSO (central statistical office) is responsible for compiling data for calculating GDP. Once the data collection process is completed, the calculation of the GDP begins. There are two methods to compute the GDP number:
Method 1: GDP at Factor Cost
The sum of net value added in various economic activities is known as GDP at factor cost. This method looks at the economic activity.
Method 2: The expenditure-based Method
The expenditure method is the most widely used approach for calculating GDP and it is a measure of the economy’s output produced within a country’s borders irrespective of who owns the means to production. In this method, GDP is calculated by summing up all of the expenditures made on final goods and services.
Formula of GDP is, GDP = private consumption + gross investment + government investment + government spending + net export.
- To compute the GDP the national income accounts use market prices.
- Used goods aren’t included in the calculation.
- Only the value of final goods counted in GDP.
What is GDP per Capita?
Gross Domestic Product (GDP) per capita represent a country’s GDP divided by its total population.
What is the Nominal GDP & Real GDP?
The nominal GDP is calculated by using the current market price and It is the monetary value of all the goods and services produced in a country.
Real gross domestic product (GDP) is an inflation-adjusted measure that reflects the value of all goods and services produced by an economy in a specific period of time and It is also referred to as constant-price GDP.
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