Gross Domestic Product (GDP) is the total monetary value of all finished goods and services produced within a country’s borders over a specific time period, usually measured annually or quarterly. GDP is widely used as a key indicator of a nation’s economic health and growth.
There are three primary ways to calculate GDP:
-
Production approach – total value of output minus intermediate consumption
-
Income approach – total income earned by individuals and businesses
-
Expenditure approach – total spending on goods and services
A growing GDP generally signals a healthy, expanding economy, while stagnant or declining GDP may indicate economic trouble. GDP can be measured in nominal terms (current prices) or real terms (adjusted
« Back to Glossary Index
