What is GDP growth rate (Gross Domestic Product) – BonSmartWay.com

When we see newspaper, or watch any news channel’s sometimes we heard word called GDP rate increase to some percentage, or GDP rate Decrease, some of the people know about this, and some people don’t know and just ignore this. Who don’t know about GDP GROWTH RATE. Let’s understand.


What is GDP ?


The gdp stand for gross domestic product. GDP percentage defines based on how well country perform in industrial, financial services, Manufacturing, production, supply, and demand, like more etc, rural areas as well as urban areas, will consider as GDP growth of the country.

This GDP rate various country by country and this keeps on changing. GDP growth calculates on every four months, year on year. Weather it’s increased or decreased, different types of methods use to calculate this GDP.

Most famous calculates method is: (GDP growth rate)


Micro-Economics 101 – National income formula.

Y = C+I+G(X-M)


Y= National income (GDP)
C= Consumer spending
I= Investment
G = Government spending
X = Exports
M = Imports

This all depends on how well management of government of the country. Like managing government schemes, financial planning, Exports and imports, Manufacturing process for export, importing for raw material. ETC.

For example:

One country manufacturing mobile and this mobile export to other countries, and importing some products from other countries. On supply and demand of the country. If supply increase than demand of product will decrease, if product manufacturing decrease than supply of demand will increase. To balance this supply and demand use this type of data for calculating GDP growth.

GDP GROWTH INCREASES OR DECREASES.

Many reasons there on fluctuation GDP growth.

Reason Increase GDP GROWTH.
1. Manufacturing process increased
2. Exporting product increased.
3. Product demand increased.
4. Country currency on demand.
5. Country development increased.

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