You are viewing the article How to Calculate GDP at Tnhelearning.edu.vn you can quickly access the necessary information in the table of contents of the article below.
This article is co-authored by a team of editors and trained researchers who confirm the accuracy and completeness of the article.
The wikiHow Content Management team carefully monitors the work of editors to ensure that every article is up to a high standard of quality.
This article has been viewed 22,023 times.
GDP stands for gross domestic product and is a measure of all the goods and services produced by a country in a year. GDP is often used in economics to compare output across countries. Economists calculate GDP using two main methods: the expenditure-based method, which measures total expenditure, and the income-based method, which measures the total amount of income. The CIA World Factbook website provides all the data needed to calculate the GDP of every country in the world.
Steps
Calculate GDP using the expenditure method
- Examples of personal consumption include purchases of consumables such as food and clothing, durable goods such as tools and furniture, and services such as haircuts or doctor visits.
- Examples of investments include contracted supplies or services to be used when a business builds a new factory, and orders for equipment and software that help the business run efficiently.
- If a country imports more than it exports, the number will be negative. If it’s negative, you need to subtract instead of adding.
- Examples of government consumption include civil servant salaries, infrastructure spending, and defense. Social insurance and unemployment benefits are considered transfers and are not included in government consumption: the money simply transfers from person to person.
Calculate GDP using the income method
Distinguish real and nominal GDP
- Think of them as follows. If country A’s GDP in 2012 was 22 trillion dong but in 2013, this country printed and put into circulation 11,000 billion dong, of course its 2013 GDP would be larger than 2012. However, this increase does not reflect good output of goods and services produced in country A. Real GDP effectively eliminates this inflationary increase.
- For example, if the country you are calculating is actually going through a period of deflation , in which case the purchasing power of the currency increases instead of decreasing, the deflation index will fall below 1. Assume the deflation rate from this period the previous period to the current period is 25%. That means a single currency can buy 25% more than the base period. Your deflation would be 75 or 1 (100%) minus .25 (25%) times 100.
- So, if your current nominal GDP is VND220 billion and the deflation is 125 (base-to-current inflation is 25%), here’s how to set up your equation :
- 220,000,000,000 VND Real GDP = 125 100
- VND 220,000,000,000 Real GDP = 1.25
- 220,000,000,000 VND = 1.25 X Real GDP
- 220,000,000,000 VND 1.25 = Real GDP
- 176,000,000,000 VND = Real GDP
Advice
- GDP per capita measures the average amount of domestic product produced by an individual in a country. GDP per capita can be used to compare the productivity of countries with large differences in population. To calculate GDP per capita, divide the country’s gross domestic product by its population.
- The third way to calculate GDP is the value added method. This method calculates the total value added at each production step of goods and services. For example, add the added value of rubber when the rubber is converted into a tire. Next, add in the added value of all the car’s parts as they are assembled into a complete vehicle. This method is not widely used because it is possible to double-count and overstate the real market value of GDP.
This article is co-authored by a team of editors and trained researchers who confirm the accuracy and completeness of the article.
The wikiHow Content Management team carefully monitors the work of editors to ensure that every article is up to a high standard of quality.
This article has been viewed 22,023 times.
GDP stands for gross domestic product and is a measure of all the goods and services produced by a country in a year. GDP is often used in economics to compare output across countries. Economists calculate GDP using two main methods: the expenditure-based method, which measures total expenditure, and the income-based method, which measures the total amount of income. The CIA World Factbook website provides all the data needed to calculate the GDP of every country in the world.
Thank you for reading this post How to Calculate GDP at Tnhelearning.edu.vn You can comment, see more related articles below and hope to help you with interesting information.
Related Search: