An overview on:

International GDP

BY: Talha Ahmed

Objectives

• After the session, student should learn

(1) Definition of GDP

(2) Significance

(3) Impacts on the economy

(4) Understanding graphs

INTRODUCTION

• GDP represents the total value of

all finished goods and services
produced over a specific time
period within a country's borders
• GDP is a key indicator used by
economists, policymakers, and
analysts to assess the overall
health and size of an economy.
Saying

"GDP number insist that we are doing

well, at a time when half the country is
suffering from personal recession"
(Edward luce)
Circular Flow
diagram
Components of GDP
Consumption
Represents the total
expenditure by households
on goods and services
Includes spending on
durable goods ,non- durable
goods , and services
Investment
Encompasses spending on
business capital, residential
construction, and changes
in business inventories
Business investments
include machinery,
equipment, and structures
Government
Spending
Includes expenditures by
all levels of government
Covers spending on public
services, infrastructure,
defense, and other
government programs
Nominal GDP vs
Real GDP

• Nominal GDP
• Measures the value of goods and
services produced in current prices
without adjusting for inflation

• Real GDP
• Adjusts nominal GDP for inflation or
deflation. It is calculated by dividing
deflator and Nominal GDP.
GDP Per Capita

• GDP per capita is calculated by

dividing the total GDP of a
country by its population

• GDP per capita = Total

GDP/Total population * 100
GDP excludes

• Goods that are saved for household

purposes and are not sold in the market

• Work in process or semi-finished goods

• Illegal goods like drugs, weed etc.

International GDP

• International GDP compares the

economic output of different
countries and is crucial for
understanding global economic
relationships, trade dynamics, and
geopolitical influences
Significance
• Indicator of Growth: GDP growth is a primary indicator of economic
expansion or contraction

• Job Creation: A growing economy, as reflected in GDP growth, often

leads to increased business activities and, consequently, job creation

• Standard of Living: GDP per capita is often used as a measure of the

standard of living

• Fiscal Policy: Governments use GDP data to formulate fiscal policies

• Investment Decisions: Investors often look at GDP growth when making

investment decisions

• Spending Patterns: Consumer confidence is influenced by GDP growth

• Monetary Policy: Central banks may adjust interest rates based on GDP
data

• Impact on Exports and Imports: GDP growth influences a country's trade

balance
Impacts on economy

• Investment in Infrastructure:
Strong GDP growth often results
in increased government revenue,
allowing for investments in
infrastructure projects that can
further stimulate economic activity
Impacts on economy

• Wealth Distribution: While GDP alone does not

address income inequality, sustained economic
growth can contribute to poverty reduction by
creating more opportunities for employment and
income generation

• Government Revenue: A higher GDP often leads to

increased government revenue, enabling the
implementation of social welfare programs and
public services

• Exchange Rates: GDP growth can influence a

country's currency strength

• Position in the Global Economy: A strong GDP

enhances a country's competitiveness in the global
market, affecting its influence in international trade
and negotiations
GRAPHS OF GDP
(2005-2022)
Indonesia Background

• Indonesia is a country which has

17,000 to 18,000 islands that
stretches along the equator in the
south-east Asia. It is known to
have large number of temples.
Graph
Kazakhstan Background

• It is the world's 9th largest country

by area, as well as the largest
landlocked country in the world. It
is famous for oil production .
Graph
Monaco Background

• It is situated on the Mediterranean

coast, which is nearer to France. It
is famous for Tourist attraction
and a home for the riches.
Graph
Sweden Background

• It a country located in Europe and

is surrounded by the Baltic sea. It
is famous for pop music , forest,
lakes and islands.
Graph
Papua New Guinea
Background

• An island country that is situated

in South-West Pacific. It is the
third largest rainforest. It is
famous for exporting crude
petroleum and gold.
Graph
Maldives Background

• It Is an independent island made

by 1,900 coral islands and is
located southwest of India and Siri
Lanka. It is famous for fishing and
the grand Friday Mosque.
Argentina Background

• A vast country situated in south

America. It is famous for leather
and football. It is also famous for
meat production and export.
Graph
Combined
graphs of
GDP ($)
Combined Graph
Conclusion

in conclusion, Gross Domestic Product (GDP) serves as a critical indicator of a country's

economic health and performance. As we have explored in this presentation, GDP measures the total value
of all goods and services produced within a nation's borders over a specific period. It is a comprehensive
tool that aids policymakers, investors, and the public in understanding the overall economic activity and
trends.
As we navigate the complexities of the global economy, it's crucial to
recognize the role of GDP in informing economic policies, aiding in international comparisons, and
facilitating strategic decision-making for businesses and governments alike. While GDP offers valuable
insights, it's essential to consider its limitations and supplement our analysis with a broader range of
indicators for a more comprehensive understanding of a nation's economic well-being and quality of life. In
conclusion, GDP is a powerful tool, but a holistic perspective is necessary for a more accurate assessment of
a country's overall economic health and prosperity.