What is GDP?

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All we've heard is that there is such a thing as the GDP, and it is very important for the country.Some even remember how Vladimir Putin in the prime of his presidential activities "threatened" to increase the GDP as much as doubled in the ten-year period.Well, let's face it, he's got a little excited.However, many of us do not know about what's GDP.

This abbreviation means "gross domestic product".To say in simple language, the GDP - is the total sum of all goods and services that have been produced in a particular period (year or quarter) for domestic consumption as well as storage and export.At the same time gross domestic product expressed in price terms.To properly and with minimal errors to calculate the level of GDP, taken several of his species.The data is then mapped and displayed on the exact result.

to understand what GDP, and calculate its size, you need to separately determine the absolute GDP (calculated at prices of the reporting period), and then separately calculate the real GDP (last year's rates without inflation).These figures compare and get a picture of the economy and the increase or decrease in the level of GDP per year.If we make simple calculations and the total value of GDP divided by the number of population in the state, then we can get the size of the index, which falls on every Russian citizen.And if you make a payment to another country, you can easily compare the level of development of the two countries.To put it more simply, to answer the question of what is GDP as follows.It is the sum of everything that consumes people, government spending, exports, investment, net imports.

That is, we consume goods and use the services and pay money for it.In turn, the state also spends money only cost, for public needs.And investors are investing their savings and financial savings in the business.However, in this system there is one more important element - a balance between import and export of products in the country.It is called trade, and it happens that it contains negative values.This is the case if a country gets on the foreign market more goods than it sells.Because of this, its GDP declines.

There is another formula for the calculation that answers the question of what the GDP in terms of revenue.So, on the basis of the foregoing, we find that the index is made up of the owners of income and personal income.In fact, these are two different formulations of a generalized concept - money.Just one case considered earnings, and in the other - expended, however, the amount and volume, and in another embodiment, appears the same.

In addition, there are concepts such as nominal and real GDP.What is the difference?The first is calculated based on the prices of the current year, while the real is expressed in base year prices, which can be both 1999 and 2000, and even 2014.Indicators and that, and another species of GDP is calculated in accordance units: rubles, US dollars or Euros.

Many countries are seeking to increase the level of GDP.As for Russia, this figure is very often raised not by the level of production of goods, as this figure falls short of the standard value of the goods produced in the Soviet era.It is possible to say with confidence that the promises of the president were empty, as for the qualitative increase in GDP is necessary to get the economy to grow at 7-8%, and for this it is necessary to invest in large amounts of money, which our country has not yet, andIn the near future is not expected.