What Exactly IS the U.S. Economy?
The U.S. Economy Is Measured by G.D.P.:The best way to understand the U.S. economy is by looking at Gross Domestic Product (GDP), which is the statistic used to measure the economy. In other words, the U.S. economy, as measured by GDP, is everything produced by all the people and all the companies in the U.S. In the third quarter 2010, it was $14.7 trillion. To make sure that GDP can be most accurately compared year-to-year, the Bureau of Economic Analysis (BEA) usually reports real GDP. Nominal GDP is the measurement that leaves inflation in the estimate. It is, therefore, much higher than real GDP.How GDP Is Calculated:To calculate real GDP, the BEA makes three important distinctions: • Imports and income from U.S. companies and people from outside the country are not included, so the impact of exchange rates and trade policies don’t muddy
The U.S. Economy Is Measured by G.D.P.:The best way to understand the U.S. economy is by looking at Gross Domestic Product (GDP), which is the statistic used to measure the economy. In other words, the U.S. economy, as measured by GDP, is everything produced by all the people and all the companies in the U.S. In 2010, it was $14.7 trillion. To make sure that GDP can be most accurately compared year-to-year, the Bureau of Economic Analysis (BEA) usually reports real GDP. Nominal GDP is the measurement that leaves inflation in the estimate. It is, therefore, much higher than real GDP.How GDP Is Calculated:To calculate real GDP, the BEA makes three important distinctions: • Imports and income from U.S. companies and people from outside the country are not included, so the impact of exchange rates and trade policies don’t muddy up the number. •
