Greetings to you, dear readers. With you Ruslan Miftakhov, and now I will try to tell you about what GDP in the economy is simple words.
Surely each of you, looking through the news on TV, when it comes to the level of income of citizens of any country, or the results of its social and economic development, reading them on the Internet or listening to the news block on the radio, have repeatedly heard or have seen this definition.
I think that today's topic will be useful to each of you without exception. Regardless of what you do, whether you are an ordinary employee of a kind of plant that makes output or providing any services, or you are the head of a business entity, each of you is a participant in creating the volume of this indicator.
I, in turn, I think that you will be interested and useful to understand what GDP is, what is the difference between it and GNP, what is the role and participation of every person engaged in the creation of products and services in providing these indicators. And in general, everyone who considers themselves a little competent, must have an idea of \u200b\u200bit.
So, let's begin…
Gross domestic product, namely, it should be deciphering this abbreviation - this is the main indicator characterizing the final value of all services rendered and manufactured in the country.
Its level is a decisive economic value for each country. At the same time, the cost of manufactured products and services is determined for the calendar year and the quarter.
It should be noted that this macroeconomic indicator has nothing to do with national or geographic affiliation and applies to any state, for example, Russia.
Thus, economists, defining this indicator, have the ability to objectively evaluate the entire volume of production aimed at investing or current consumption, in the domestic level or in the context of each sector.
Calculating the gross domestic product can be understood:
- what is the national income of the state as a whole;
- how successfully the economic activity is carried out;
- how active in their activities business entities;
- to conduct an analysis of the economy by industry, evaluating the effectiveness of each of them. This will make it possible to understand what the structure of the state economy, and which industry is a source of income to the state treasury;
- determine the potential volume of goods and services that can be produced in the near future;
- and what are the trends, and forecasts of macroeconomic processes.
Thus, the calculation of the value of the gross domestic product allows us to evaluate the socio-economic condition of any separate state and at what stage of development is currently the global economy.
If you analyze it in terms of changing the value of the gross domestic product, it is necessary to take into account the fact that its actual volume is influenced by the number of unemployment in the state or the value of unemployment, that is, unemployment plays not the most recent role in ensuring national welfare.
The difference between GDP and GNP
If we talk about the gross domestic product, then it characterizes the size and speed of the socio-economic development of the state. The high value of the indicator indicates its well-being and wealth, and in turn, in turn, on the contrary.
And in a situation where economists and financiers, as well as the leaders of the country, argue about its economic growth or fall, they operate precisely precisely indicators of GDP in dynamics, i.e. For some time interval.
The gross national product determines the cost of the national economy, without taking into account the location of the enterprise or citizens, while GDP determines the value of goods and services produced within the state, i.e. on its territory.
Now let's talk about what types of the indicator exist.
Types of indicator
In order to determine the magnitude of the indicator, specialists use different approaches. The choice of each of them will depend on which processes in the country should be appreciated.
Experts identify such types of indicators:
- nominal;
- real;
- and purchasing power parity (PPP).
When nominal GDP is calculated, then it is determined in the current prices. The minus of this approach is that it does not take into account the inflation rates, as a result of which the calculated nominal value can be elevated at the moment when the production volume in the country is reduced.
Thus, the nominal value shows only the growth or the fall in the value of the goods produced, and not the dynamics of production.
In turn, real GDP takes into account the level of inflation and characterizes the dynamics of production volume. The advantage of this approach is that it reflects the growth of turnover in the state, if it takes place. It does not depend on changes in the currency exchange rate or other factors.
Huge interest, both for the specialists of the field of finance and economy and ordinary ordinary people, the calculation of the value of the material benefits produced, adjusted for purchasing power.
For this, calculate the value per capita, dividing the resulting magnitude of the macroeconomic indicator into population. With this approach, the solvency of the country's population is estimated.
In general, the value of the indicator allows you to estimate the level of the material condition of society.
I hope that today's topic was interesting and made it possible to understand better what is GDP. If this is true, then share it with friends in publics and subscribe to me.
By tradition, do not miss an interesting video, an excerpt from the movie "Nogyanov Company".
Write in the comments who understood what the difference is thinking rich from the poor.
Thank you for being with me, and to new meetings friends.
Sincerely, Ruslan Miftakhov
