GDP Full Form | Full Form of GDP | What is the Full Form of GDP
GDP Full Form - Gross Domestic Product
- Here, you’ll get the solution of the following GDPrelated questions: full form of GDP , what is the full form of GDP , full form of GDP in economics , full form of GDP growth .
Gross Domestic Product
- GDP stands for Gross Domestic Product.
- It's the entire market price of all the goods, products and services produced within a country during a specific duration of your time.
- It's used to measure the dimensions of an economy and overall growth or decline in the economy of a nation.
- It indicates the economic health of a country also as specifies the living standard of the people of a selected country, i.e. because the GDP increases the living standard of the people of that country increases.
- A country having good GDP is considered as a country for living purpose.
- In India, there are three main sectors that contribute to GDP; Industry, Service sector and Agriculture including allied services.
History
- The basic concept of GDP was given by William Petty to defend landlords against unfair taxation between the Dutch and the English between 1652 and 1674.
- This method is further developed by Charles Davenant.
- Its modern concept was first developed by Kuznets in 1934.
- After the Bretton Woods conference in 1944, it became the foremost tool to measure the economy of a country.
How to calculate GDP
- There are many approaches to calculate GDP. If we mention an easy approach, it's adequate to the entire of consumption, gross investment and government spending plus the worth of exports, minus imports.
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Formula
GDP = COE + GOS + GMI + TP & MSP & M
Or
GDP = private consumption + gross investment + government spending + (exports - imports)
Various Approaches Of GDP
- Following are the various approaches to calculate GDP:
- Production approach
- Income approach
- Expenditure approach
Production approach
- Also referred to as Value Added Approach, it calculates what proportion value is contributed at each stage of production.
Income approach
- The second way of estimating GDP is to use "the sum of primary incomes distributed by resident producer units".
- If GDP is calculated this manner it's sometimes called gross domestic income (GDI), or GDP (I).
Expenditure approach
- The third approach to estimate GDP is to calculate the sum of the ultimate uses of products and services (all uses except intermediate consumption) measured in purchasers' prices.
- In the case where a good is produced and unsold, the quality accounting convention is that the producer has bought the good from themselves.