US GDP Assignment Help
Abstract
GDP is the market value of final goods and services that are produced in country over a limited time period. In US, GDP increased from 2000, but it started to decrease from 2006 and gone negatively in 2009 due to the recession. But in present, it started to recover and forecasted annual growth is up to 3.3% in 2012. GDP is calculated on the basis of private & public consumption, government spending, investment, import and export within a defined territory. As per assignment help experts, It is interpreted with the help of past economic data, growth rate and level of changes in the consumption pattern and all sectors.
Introduction
GDP is the total value of all goods and services that produced in country over a specific period. GDP is reported in two forms like constant and current dollar. Constant dollar converts current information into base dollar and current dollar is based on existing market conditions and compares two periods. In this, trends, forecasts and statistics and US GDP will be discussed. Along with this, calculation of GDP and expected GDP will be described.
Trends, Forecasts and Statistics
In US, nominal GDP is recorded in billions of dollars and real GDP is a percentage of a standard year. The value of US GDP has increased continuously and the highest value recorded in 2010 at 14,526.5 billion. Annual GDP growth is characterized by cyclic period of boom and depression. GDP of US increased from 1994 to 1997 and decreased on 1998 and then increased in 2000 (Office of Management and Budget, 2011). In 1998 to 2000, economy of US registered a boom and growth rate is increased by 6.39% in 2000. In 2005, the highest growth was registered that was 6.49%. After this, annual growth rate registered 5.97% in 2006, 4.87% in 2007 and 1.87% in 2008 and lowest in -2.47% in 2009.
In 2012, it is forecasted that GDP will grow up to 3.3 to 3.7% (Federal Reserve cuts US GDP forecast; no hint of more support, 2011). It is because, increasing inflation in the country that reduces consumer purchasing power and personal consumption expenditure. In 2010, economy is improved and growth is recorded at 4.21%.In 2010, GDP per capita is $ 48,666 in which service sector includes 76.9%, manufacturing sector with 21.9% and agriculture sector accounting for 1.2%. Inflation is projected for 2012 is 2.3%.
Gross Domestic product
GDP: Gross domestic product may be defined as the market value of final goods and services produced within a country in a given period. Hence, simply, GDP is the monetary value of all the finished goods and services produced within a country’s borders in a specific time period (Tucker, 2010). The GDP is calculated on an annual basis that includes all types of private & public consumption, government spending, investment, import and export within a defined territory. Hence, with the help of GDP components, a particular country can determine the rate of GDP (Fang & Miller, 2009). For instance, GDP = private consumption + gross investment + government spending + (exports − imports), or
GDP=C +I+ G+ (X – M)
GDP = Total value of goods and services produced in the United States
GDP-PRICE = Price index indicating the overall level of prices in the economy
C or CONS= Value of Expenditures on Consumption (Tucker, 2010).
I or INVESTMENT= Value of Expenditures on Investment
G or GOV= Value of Government Purchases of Goods and Services
EXPORTS= Value of Exports of Goods and Services
IMPORTS= Value of Imports of Goods and Services
GDP will be equal to the value of all the goods and services produced for money in an economy. Basically, GDP is evaluated at their market prices. GDP excludes the value of unpaid work. GDP is calculated by adding up the value-added at each stage of production (Fang & Miller, 2009).
Interpreting GDP
There are several tools available in today’s economic environment to interpret the real or nominal GDP. For example, a positive real GDP number reflects a growing economy. On the other hand, a negative GDP number reflect a declining in a particular economy (Tucker, 2010). Hence, with the help of positive and negative GDP number, a particular country or economy can interpret the real or nominal rate of GDP. Along with this, two consecutive quarters of GDP decline is generally associated with recession. In addition, percent change from the previous period is also an indicator for the GDP (Truscott, 2000).
With the help of this economic data, a particular country can interpret the GDP. Additionally, with the help of the annualized rate of growth of different sectors of the economy, an economy can interpret the GDP in an effective manner. The change in the spending pattern of a country is also one of the significant tools that clearly indicate the GDP of a particular country (Fang & Miller, 2009). Additionally, the Level and changes in the industry is also one of the important elements to interpret the nominal or real GDP.
References
Fang, W. S. &Miller, S. M. (2009).Modeling the volatility of real GDP growth: The case of Japan revisited. Japan and the World Economy, 21(3), 312-324.
Federal Reserve cuts US GDP forecast; no hint of more support. (2011). Retrieved from The Economic Times: http://economictimes.indiatimes.com/news/international-business/federal- reserve-cuts-us-gdp-forecast-no-hint-of-more- support/articleshow/8956240.cms
Office of Management and Budget (2011).Historical Tables: Budget of the U.S. Government, Fiscal Year 2012. USA: Government Printing Office.
Truscott, F. B. (2000).Activities for Economics Education. USA: Walch Publishing.
Tucker, I. B. (2010).Macroeconomics for Today. USA: Cengage Learning.