GDP(Gross domestic Product).

1. Welcome to our presentation

2. Topic :
Gross domestic product (GDP).
Group member:
1.Shahria Shanta
ID:
2. Md .Imran Hossain
ID:

3. GDP
Gross domestic product (GDP) is a monetary measure of the
market value of all final goods and services produced in a period
(quarterly or yearly). Nominal GDP estimates are commonly used
to determine the economic performance of a whole country or
region, and to make international comparisons.

4. Determining gross domestic product (GDP)
GDP can be determined in three ways, all of which should, in
principle, give the same result. They are the expenditure
approach, the production (or output or value added) approach
and the income approach.

5. Expenditure approach
Expenditure: Expenditure method of computing GDP by adding
expenditure of final goods and services.
Step:
1. consumption: consumption expenditure of household.
2. Investment: Purchases Of capital goods and firms.
a. Gross private domestic investment.
b. Net private investment= gross private investment –
depreciation

6. 3. Capital: Manufacture final goods that are
use to help produce other good and services.
4. Government purchases in the final goods and
services.
5. Net export =export-import

7. The production approach
The production approach, which is also called value added approach or net
output approach.
Step:
1. Classify production unit into sector .
2. Estimates NVAfc of each sector.
a. Eastimate value of output = Sales+c.s-os
b. Deduct intermediate cost from v.o to get GVAmp.
c. Deduct dep CFC from GVAmp to arrive at NVAmp.
d. Deduct indirect taxes and add substitute get NANfc.
3. Take the sum of NVAfc by all sector NVAfc=NDNfc.
4. ADD NFIA TO NDPfc to get NNDfc or NI.

8. National income almost equal to GDP.
Disposable Income:
1. Personal income =national income .
2. Disposable income = personal income – personal taxes.

9. Gross domestic product expenditure
loaded equation:
Y=C+I+G+(X-M)
Here,
Y = total output .
C = Private consumption.
I = Gross private domestic investment
G = Government Consumption
X = Exports
M = Import

10. Income
Income: Another method of computing GDP ADDUP total
Income.
National income is comperes of
1. Compensation of employee (Income earns from labor).
2. Rent ( Income earn from owned Land)
3. Investment ( Income earn from owned organization)
4. Proprietors income ( Income earn from organization
production)

11. Nominal vs Real GDP Calculation
Final
Goods
Price
2011
Quantity
2011
Price
2012
Quantity
2012
Nominal GDP Real GDP
2011 2012 2011 2012
Bread 3 100 4 125 300 500 300 375
Butter 2 50 2.50 60 100 150 100 120
Total 400 650 400 495

12. % change of nominal GDP
=((Final-initial)/initial))*100%
=((650-400)/400))*100%
=62.5%
% change of real GDP
=((Final-initial)/initial))*100%
=((495-400)/400))*100%
=23.75%

13. Thanks