GDP, or Gross Domestic Product, is a key economic indicator that measures the total value of goods and services produced within a country's borders over a specific period, typically a quarter or a year. It reflects the economic health of a nation and is widely used to compare the economic performance of different countries.
Key Components of GDP
- Consumption: Spending by households on goods and services (e.g., food, housing, entertainment).
- Investment: Business spending on capital goods (e.g., machinery, buildings) and inventory changes.
- Government Spending: Public sector expenditures on goods and services (e.g., infrastructure, education).
- Net Exports: Exports minus imports (e.g., trade balance with other countries).
Why GDP Matters 🌍
- Economic Growth: Rising GDP indicates a growing economy.
- Policy Decisions: Governments use GDP data to formulate economic policies.
- Market Trends: Investors analyze GDP to predict market movements.
For deeper insights into GDP and other economic indicators, visit our Economic Indicators Guide.