GDP - 10 mins Seminar Notes
GDP -Gross Domestic Product
GDP is a monetary measure of the market value of all the final goods and services produced within the country in a specific time period-annually.
• King of economic statistics
• Important tool to measure the health and strength of a country’s economy.
Background
• 1654-76 William Petty, came up with the basic concept of GDP to attack landlords against unfair taxation during warfare between Dutch and English
• 1695 – Charles Davenant, developed this method further
• 1934 – Simon Kuznets, Developed the modern concept of GDP.
• 1944 – Bretton Woods conference, GDP became the main tool for measuring the country’s economy.
How to Calculate GDP
GDP= Consumption + Investment + Government Spending + (Exports – Imports)
• Consumption- Consumer spending(buying dress, drinking coffee) consumption represents 50% of the country’s GDP
• Investment- Business, Building, Land, Equipment, Buying home.
• Government Spending- School, Roads, Defence..
• If GDP is rising, the economy is in good shape and
The nation is moving forward.
• If GDP is falling, the economy is in trouble and the
Nation is losing ground.
How can we say? If GDP increases the country’s economy is growing
• Hire more workers, hike in salary and wages, leads to consume more products.
World GDP Rank
- US -21.8 Trillion
- China -15.5 Trillion
- Japan -5.3 Trillion
- Germany -4.42 Trillion
- India -3.16 Trillion
Presented By
Nithya P
TNPSC Student
Magme School of Banking
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