What is gdp and why is it important essay

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What is gdp and why is it important essay

Reference Copied to Clipboard. An overview of US economy The economy is the most important indicator to judge the internal living conditions and social development of any country. It provides information about the development of basic factors like health, education, happiness, infrastructure, living standard, etc.

United States is one of the largest economies that has gained huge level of hold on the world economy and controls the world economy through its internal situation.

It is clear that US has created its powerful industrial structure and per capita income is also appreciable inside the country.

Further, the role of technology within the US economy is also remarkable. Technologically the US has seen highest advancement and development that is sufficient enough to grow the economy as compare to other countries.

The external economic factors put the positive impact at each another and lead towards the growth of the economy and the internal economic environment.

The government has their intervention into only health sector and transportation area. The country has maximum number of private companies who are successful and have earned huge profits all across the world. Even the government buys the required products from private companies. This economic ideology is highly success in US and ensures the proper flow of income and effective utilization of natural resources.

The decision making is in the hands of private firms in the US. Here the private companies faced the high level of leverage of such kind of economic structure in expanding their business and taking the decisions appropriately. The technological areas have brought down the revolution in entire world and America has become the pioneer of such advancements.

The aerospace, computers, communication and information technology, medical, military, etc. The residents of the country get their own home that was the positive indicator for US economy.

This essay is an example of a student's work Disclaimer This essay has been submitted to us by a student in order to help you with your studies. This is not an example of the work written by our professional essay writers. But another fact is that the people who had less technical skills and educational qualifications they face trouble in establishing their growth in the era of technology.

Gross Domestic Product (GDP): An Economy’s All - Back to Basics: GDP Definition

They found obstacles in facing pay rises and other benefits at work place. It determines the unequal distribution of wealth and employment opportunities. At the same time, the US economy has faced huge level of growth in literacy ratio.

To meet out the requirement of technology people started to get educated and it just raises the level of employment within the country. Thus, the technology works positively in the long run and negatively in the short run.

But its negative consequences are negligible as compare to the positive results. Unequal distribution of wealth is another factor that could be realized in US economy over the recent past or industrial development time. Now the contribution or the role of oil is very significant in US economy.

The America imports such huge amount of crude oil for the consumption of residents. During to the petrol prices were not so stable, and it just create trouble for US economy to handle the situation. At the same time, the financial crisis took place in the entire world and America faced two major problems.

One was dampening the housing market, and other was related to the rise in oil prices. It just created the trade deficit and most importantly the value of the dollar was depreciated as compare to other currencies. The fluctuations become very common scenario, and it creates trouble in handling the economic structure.

Another problem that America started to face is related to high import ratio as compare to export. The US has plenty of natural resources, but most of them have been utilizing for inside consumption. There was very less export, and it just stuck the internal flow of money and capital.

The infrastructural development was on the peak that is another indicator for healthy economic structure. Still the infrastructure development of US is appreciable and increasing year on year. Become a Freelance Writers Place an Order The bankruptcy of banks like Lehman Brothers was the worst era for US economy where they found trouble in managing the mortgage prices, investment failures, credit failures and so on.

At that time, US faced a high level of issues with respect to their economic structure. The reason behind the economic recession is the socially huge spending habits of people and low saving ratio.

It was the actual scenario of US that people earn less, but they spent more than their earning. For the same purpose, banks issued more number of loans, and the amount was so high thus it creates the negative flow of money within the economy and it just lead towards the economic recession.

Other than this the expenditure upon the security of the country from outside attack is something that has affected the US economy negatively.GDP is a crude aggregate figure that masks important internal trends and obscures context and circumstance. However, that being said, GDP is useful in the foreign policy sense because it provides a standardized basis for comparing the economic powers of countries.

What is gdp and why is it important essay

Nominal GDP refers to a country's economic output without an inflation adjustment, while Real GDP is equal to the economic output adjusted for the effects of inflation. Essay about What is GDP and why is it important? comparison to the previous quarter or year.

For example, if the year-to-year GDP is up 3%, this is thought to mean that the economy has grown by 3% over the last year. Why economic growth is important Economic growth can help various macroeconomic objectives. Reduced debt to GDP ratios. Economic growth helps reduce debt to GDP ratios.

In the s, the UK had a national debt of over % of GDP. Despite very few years of budget surplus, economic growth enabled a reduction in the level of debt to GDP.

An overview of US economy - Essay Example

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Print Reference this. Disclaimer: GDP, party due to implementation capacity constraints but also due to financing constraints. It has played important role for economic growth in this global process. But, the distribution of FDI is uneven in all over the world.

Some countries.

What is GDP and why is it so important to economists and investors? | Investopedia