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Gross Domestic Product (GDP) is a metric used to assess a nation's economic activities. It shows the entire cost of all products made inside a nation's boundaries in a specific time frame, typically a year or a quarter. It is regarded as one of the most significant measures of an economy's health.
The market value of all finished goods and services produced inside a nation over a certain time period is added up to determine the GDP. The production approach, the income approach, and the spending approach are frequently used to calculate it.
The output strategy entails totaling up all the commodities and services that are produced in the nation. By adding up the income that people and businesses generated during the manufacturing process, the income approach determines GDP. The expenditure approach adds up the total amount of money that individuals, companies, and the government spend on products and services.
Because it reflects the entire expansion or contraction of the economy, GDP is a key indication of a nation's economic health. To assess the sturdiness and stability of a nation's economy, analysts, investors, and policymakers use it. Although it does not take into account things like economic inequality, environmental damage, or social wellbeing, GDP has its limitations.
