GDP Lesson

This is the dollar value of all final goods and services produced within a country's borders in a given year

Gross: Total
Domestic: Within the country's borders
Product: Production of final goods/services

New Clothing

New Vehicles

Food

Salon Services

​This is called the Expenditure Method. It looks at how much is spent on each category.

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Calculating GDP

60 - 70 % of GDP
$ value of goods and services purchased in the current year
Examples: Food, haircuts, clothing

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Consumption (Consumers)

10 - 15% of GDP
Businesses buying machines, research, inventory.

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Investment (Business Investment/Spending)

15 - 20% of GDP
Examples: Roads, schools, military, parks, etc

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Government Spending (Federal, State, and Local)

5-10% of GDP
Exports: US products sold to other countries
Imports: Products we buy from other countries

Net Trade (Exports - Imports)

Products consumed in a relatively short period of time.

Nondurable Goods

Products tend to last more than a year.

Durable Goods

Cotton used in clothing

Chocolate used in candy

Steel used in machines

Wood used in houses

Products not produced within the year

Used

Illegal activities or leisure activities

Non-Market

Gifts, or nothing produced

Transfer

Paper assets - stocks, bonds

Financial Transactions

Leisure activities, income distribution, barter, and DIY

Positive externalities, nonmonetary transactions, and social well-being