Gross Domestic Product (GDP)
The scorecard of a country’s economic health.
Gross Domestic Product (GDP) is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period. It functions as a broad scorecard of a given country’s economic health.
The Components
GDP is calculated by adding up four main components: Consumption, Investment, Government Spending, and Net Exports.
Real vs. Nominal GDP
GDP is calculated by adding up four main components: Consumption, Investment, Government Spending, and Net Exports.
Key Takeaways
Measure of total economic output.
Can be calculated via expenditures, production, or income.
Real GDP adjusts for inflation; Nominal GDP does not.
Related Terms
Gross Domestic Product (GDP)
The scorecard of a country’s economic health.
Gross Domestic Product (GDP) is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period. It functions as a broad scorecard of a given country’s economic health.
Table of Contents
The Components
GDP is calculated by adding up four main components: Consumption, Investment, Government Spending, and Net Exports.
Real vs. Nominal GDP
GDP is calculated by adding up four main components: Consumption, Investment, Government Spending, and Net Exports.
Key Takeaways
Measure of total economic output.
Can be calculated via expenditures, production, or income.
Real GDP adjusts for inflation; Nominal GDP does not.
Related Terms
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