Wk 1 Discussion – GDP [due Day 3]
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Respond to the following in a minimum of 175 words:
GDP is a strong measure of the health of the economy, and it’s among the most important and widely reported economic data.
· In your own words, summarize nominal GDP.
· Discuss the limitations of gross domestic product (GDP) as a measurement tool.
· What is the difference between real and nominal GDP?
· Locate an online news article that discusses impacts to GDP in some way. Summarize the article and explain its relation to/impact on GDP.
· Cite your sources.
Nominal GDP is GDP computed at current market prices. GDP is the monetary worth of all completed products and services produced inside a country’s borders in a specific time period. Contrary to real GDP, nominal GDP takes into account price changes brought on by inflation or a rise in the overall level of prices.
GDP of a nation measures the monetary value of the products and services generated in a specific year.
Y = GDP if
P represents price.
The letter Q stands for the quantity of products or services.
As a result, by definition,
The formula for the nominal GDP is Y=P.Q. Simply put, this suggests that the GDP is measured in terms of money. Nominal meaning in monetary terms.
The Gross Domestic Product (GDP) is a measure used to assess a nation’s economic health. It is a measure of the total value of all commodities and services produced within a nation’s boundaries during a certain time period. GDP may be used by economists to assess whether a nation’s economy is expanding or contracting.
Four supply factors—natural resources, capital goods, human resources, and technology—directly affect the value of products and services provided. GDP growth refers to a rise in GDP’s rate of growth, however the factors influencing each component’s rate of growth are quite diverse (BOLDEANU, 2015).
BOLDEANU, F. T. (2015). The main determinants affecting economic growth . Bulletin of the Transilvania University of Braşov.