Gross Domestic Product (GDP)
In this lesson on Gross Domestic Product (GDP), you will learn the following concepts:
*What is meant by GDP?
*What is the difference between Nominal GDP and Real GDP (RGDP)?
*What is the Formula for RGDP?
*What are the Components of RGDP and Their Values?
*What is meant by Real GDP per capita?
*What is the Difference between Nominal GDP and Real GDP?
*How to Calculate RGDP by Using the RGDP Deflator
*What is NOT Included in RGDP?
*What is the 2019 Nominal GDP and What is the 2019 Real GDP?
*What is meant by GDP?
*What is the difference between Nominal GDP and Real GDP (RGDP)?
*What is the Formula for RGDP?
*What are the Components of RGDP and Their Values?
*What is meant by Real GDP per capita?
*What is the Difference between Nominal GDP and Real GDP?
*How to Calculate RGDP by Using the RGDP Deflator
*What is NOT Included in RGDP?
*What is the 2019 Nominal GDP and What is the 2019 Real GDP?
Real GDP (3:11 minutes)
Reffonomics.com 3 x 3 Videos (3-minute videos + 3 Multiple Choice Questions)
What is meant by GDP?
What is NOT Included in RGDP? (2:45 minutes)
Before you learn what Real GDP is, you should
understand the difference in measuring the quantity of
goods and services in Microeconomics as compared to
Macroeconomics.
In Microeconomics, the quantity of goods and services
is based upon a certain market, either the product
market or the resource market. For example, when
looking at the market for apples, you look at apples in
a given product market or you look at apples in a given
resource market that produces the apples.
In Marcoeconomics, though, you look at aggregate
markets. Aggregate markets means "the total of all
markets added together. This term aggregate is very
important in Macroeconomics.
understand the difference in measuring the quantity of
goods and services in Microeconomics as compared to
Macroeconomics.
In Microeconomics, the quantity of goods and services
is based upon a certain market, either the product
market or the resource market. For example, when
looking at the market for apples, you look at apples in
a given product market or you look at apples in a given
resource market that produces the apples.
In Marcoeconomics, though, you look at aggregate
markets. Aggregate markets means "the total of all
markets added together. This term aggregate is very
important in Macroeconomics.
What is the Formula for Real GDP?
What are the Components of RGDP and Their Values?
What is NOT Included in RGDP?
In this lesson on Gross Domestic Product (GDP), you have learned the following
concepts:
*What is meant by GDP?
*What is the difference between Nominal GDP and Real GDP (RGDP)?
*What is the Formula for RGDP?
*What are the Components of RGDP and Their Values?
*What is meant by Real GDP per capita?
*What is the Difference between Nominal GDP and Real GDP?
*How to Calculate RGDP by Using the RGDP Deflator
*What is NOT Included in RGDP?
*What is the 2019 Nominal GDP and What is the 2019 Real GDP?
concepts:
*What is meant by GDP?
*What is the difference between Nominal GDP and Real GDP (RGDP)?
*What is the Formula for RGDP?
*What are the Components of RGDP and Their Values?
*What is meant by Real GDP per capita?
*What is the Difference between Nominal GDP and Real GDP?
*How to Calculate RGDP by Using the RGDP Deflator
*What is NOT Included in RGDP?
*What is the 2019 Nominal GDP and What is the 2019 Real GDP?
| Steven M. Reff Economics Lecturer University of Arizona (2007 - 2016) The 2015 University of Arizona Five-Star Faculty Award |
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What is Meant by RGDP per Capita?
What is the difference between Nominal GDP and Real GDP (RGDP)?
The term GDP by itself refers to nominal GDP which includes
inflation or expected inflation. The term Real GDP or RGDP
which excludes inflation or expected inflation.
You will learn more about the terms nominal vs. real in an
upcoming lesson. From this point forward you will only be seeing
the term RGDP, rather than just GDP.
Let's refresh your memory on the definition of RGDP. Fill in the
boxes below with the correct words.
inflation or expected inflation. The term Real GDP or RGDP
which excludes inflation or expected inflation.
You will learn more about the terms nominal vs. real in an
upcoming lesson. From this point forward you will only be seeing
the term RGDP, rather than just GDP.
Let's refresh your memory on the definition of RGDP. Fill in the
boxes below with the correct words.
RGDP per capital is simply the market value of all final goods and
services produced inside a country in a year divided by the
population (per capita means per person).
At the end of 2018, the RGDP = $21.45 trillion and the population
was 327.2 million people. When you take the U.S. RGDP of
$21.45 trillion divided by 327.2, the RGDP per capital is
$62,622.23. This means the dollar value of the real output per
person in the U.S. is equal to this amount.
On the chart below, take your cursor or finger and click on the bar
graph to see what the RGDP per capita is for the countries listed.
services produced inside a country in a year divided by the
population (per capita means per person).
At the end of 2018, the RGDP = $21.45 trillion and the population
was 327.2 million people. When you take the U.S. RGDP of
$21.45 trillion divided by 327.2, the RGDP per capital is
$62,622.23. This means the dollar value of the real output per
person in the U.S. is equal to this amount.
On the chart below, take your cursor or finger and click on the bar
graph to see what the RGDP per capita is for the countries listed.
RGDP Deflator (2:55 minutes)
What is the Difference between Nominal GDP and Real GDP?
GDP Deflator in the United States increased to 112.66 points in the third
quarter of 2019 from 112.19 points in the second quarter of 2019. GDP
Deflator in the United States averaged 53.53 points from 1950 until 2019,
reaching an all time high of 112.66 points in the third quarter of 2019 and a
record low of 12.85 points in the first quarter of 1950.
https://tradingeconomics.com/united-states/gdp-deflator
quarter of 2019 from 112.19 points in the second quarter of 2019. GDP
Deflator in the United States averaged 53.53 points from 1950 until 2019,
reaching an all time high of 112.66 points in the third quarter of 2019 and a
record low of 12.85 points in the first quarter of 1950.
https://tradingeconomics.com/united-states/gdp-deflator
3rd Quarter of 2019
Nominal GDP: 21.542 trillion
(shown in current dollars)
Real GDP: 19.121 trillion
(shown in constant or chained dollars)
Real GDP Deflator: 112.66
Nominal GDP: 21.542 trillion
(shown in current dollars)
Real GDP: 19.121 trillion
(shown in constant or chained dollars)
Real GDP Deflator: 112.66
How to Calculate RGDP by Using the RGDP Deflator or Implicit Price Deflator Formula?
What is the 2019 Nominal GDP and What is the 2019 Real GDP?