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Exam details
GDP (Gross Domestic Product) is the total monetary value of all final goods and services produced within a country's borders in a specific time period.
The three approaches are the expenditure approach (C + I + G + NX), the income approach (sum of all incomes earned), and the production/output approach (sum of value added at each stage).
GDP = C + I + G + (X − M), where C = consumption, I = investment, G = government spending, X = exports, M = imports.
Nominal GDP is measured at current market prices, while real GDP is adjusted for inflation using a base year's price level, reflecting true output changes.
The GDP deflator is a price index calculated as (Nominal GDP / Real GDP) × 100. It measures the overall level of prices for all goods and services included in GDP.