Brief Info about Gross Domestic Product, its Function and Components.

1. Gross Domestic Product

2. What is GDP?
• Gross domestic product (GDP) is a
monetary measure of the value of all final
goods and services produced in a period
(quarterly or yearly).
• Nominal GDP estimates are commonly used
to determine the economic performance of
a whole country or region, and to make
international comparisons.

3. Components of GDP
•Consumption (C)
•Investment (I)
•Government Spending's (G)
•Net Exports (X – M)

4. To Calculate GDP

5. Consumption
 It is Household Final Consumption Expenditure
 It Includes
• Durable Goods
• Non-Durable Goods and
• Services
Eg: Food, House Holds, Medical Expenses, Rent, Jewellery, Gasoline,
etc.

6. Investment
 Investment by Business or Households in Capital.
 It Includes
• Construction of New Mine.
• Purchase of Machinery or Equipment for Factory.
• Purchase of software.
• Expenditure on New Houses.
• Buying Goods and Services.
 Investments on Financial Products is not included in Investments.

7. Government Spending's
 Total Government Expenditures on Final
Goods and Services.
 It Includes
• Investment Expenditure by Government.
• Purchases of weapons for Military.
• Salaries of Public Servants.
It does not include any transfer payments,
such as social security or unemployment
benefits.

8. Net Exports (X – M)
Gross Exports (X)
• All Goods and Services Produced for
Overseas Consumption.
Gross Imports(M)
• Any Goods or Services Imported for
Consumption.

9. Indian Economy-Facts on
India GDP
• Indian Economy is the 10th Largest Economy in the world.
• India's GDP is Ranked 7th in GDP Global Ranking.
• India is one of the most rapidly growing economies in the world.
• The GDP of India in the Year 2015 was US $2183 Billion.
• Ranks 3rd pertaining to Purchasing Power Parity (PPP) according to
world bank.
• The Growth Rate of India GDP in 2015 is 7.3%.
• Per capita income in India is $1,820 at Nominal and $6,664 at PPP.

13. THANK YOU