GDP (gross domestic product)
Also called: gross domestic product, real GDP, nominal GDP
GDP is the total market value of all final goods and services produced in a country in a period. It is the main measure of the size of an economy and how fast it's growing.
Nominal GDP uses current prices; real GDP adjusts for inflation, so it shows whether the economy actually produced more.
Formula
GDP = C + I + G + (X − M): consumption + investment + government spending + net exports
Related terms
- Recession: A recession is a significant, widespread fall in economic activity that lasts more than a few months.
- Inflation: Inflation is the rate at which prices across the economy rise over time, so each dollar buys less.
- Fiscal policy: Fiscal policy is the government's use of spending and taxes to influence the economy.
Guides
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