Growth of GDP and Types of GDP

1.Current GDP is expressed in the GDP at current prices for the period to measure.

2. The nominal GDP growth of GDP growth in nominal (unadjusted for price changes).

3. Real GDP growth is adjusted for price developments.

Calculation of actual prices allows economists to determine whether production has increased or decreased, little change in the purchasing power of money.

The income account of GDP

Another way of measuring GDP is to measure the total income payable in GDP income accounts. In this situation, we will sometimes hear of gross domestic income (GDI), rather than gross domestic product. This should provide the same number as the expenses described above. (By definition, GDI = GDP. In practice, however, measurement errors will both figures slightly when declared by the National Statistical Offices.)

The formula for GDP measured in income approach, called GDP (I), is:

GDP = compensation of employees + gross operating surplus gross mixed income + + Taxes less subsidies on production and imports

* Compensation of employees measures the total compensation of employees for work done. It includes salaries and wages, as well as employer contributions to social security and other programs. (COE)
* Gross operating surplus is due to the excess of the owners of businesses. Often called profits, but only a subset of total costs are subtracted from gross output to calculate GOS
* Joint Revenue Gross (GMI) is the same as the GOES, but also for unincorporated businesses. This often includes smaller companies.

The sum of the WCC, GOS and GEM is called total factor income, and measures of the value of GDP price (core) difference between the base price and the final price (the ones used in the calculation costs) is the total of taxes and subsidies that the government receipts and payments on the production. So, by adding taxes less subsidies on production and imports converts GDP at factor cost in relation to GDP (I).

The formula:

GDP = C + I + P + W + SA

Where is R = rent, I = Interest, P = profits
SA = statistical adjustments (corporate income taxes, dividends, the undistributed profits

of companies)
W = Wages

Measurement’s of International standards

International standard’s

The international standard for measuring GDP is contained in the book System of National Accounts (1993), which has been prepared by representatives of the International Monetary Fund, European Union, Organization for Economic Cooperation and Development, United Nations and the Bank World. The publication is normally designated as SNA93, to distinguish it from the previous edition published in 1968 (known as SNA68).

SNA93 provides a set of rules and procedures for the measurement of national accounts. The standards are designed to be flexible, to take account of differences in the statistical needs and conditions.

National Measurement

In each country's GDP is normally measured by a national government statistical agency, as private sector organizations do not normally have access to necessary information (in particular information on expenditure and production by governments).

GDP can be measured expenditure of all goods and services. GDP can also measure all income earned.

Interest rate’s

Net interest expense is a transfer payment in all sectors except the financial sector. Interest expense net in the financial sector is seen as the production and value added and is added to the GDP.