GDP (Gross Domestic Product) is the most common way of measuring the total output of an economy over a given period of time.
GDP measures the value of all final goods and services which are produced in an economy. It includes those which are sold within the country (domestically) as well as those which are sold to overseas buyers (exports).
GDP is used by countries all over the world to calculate economic growth so it is the most widely used measure for making international comparisons.
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Key terms:
Economic growth – when the total output of a country is increasing. Usually measured by an increase in GDP.
Real GDP – GDP adjusted for inflation over a period of time.
GDP per capita – GDP divided by the total population.