Macroeconomic accounting principles in the GDP of a country
Learning activity: In order to strengthen the knowledge acquired throughout this session, the following activity will be carried out:
Through an essay he explains: What is the importance of correctly determining the gross domestic product for a country? And if the products in process and the finished products are counted in the GDP? Yes or no and why?
The importance of performing a detained analysis of national accounting lies in the first place because it constitutes the formal structure of macroeconomic models and secondly, to obtain figures that are approaches that help us understand an economy. One of the main considerations is that payments to the factors include income from abroad;In this way adding the payments to the gross domestic product, the gross national product or PNB is determined.
What is the importance of correctly determining the gross domestic product for a country? And if the products in process and the finished products are counted in the GDP? Yes or no and why?
In this essay I will develop the importance of correctly determining the calculation of GDP (Gross Domestic Product), in order to know the different elements that integrate it, GDP (Gross Domestic Product) is part of the study of macroeconomic accounting, sinceWhen carrying out an analysis of national accounting lies in obtaining figures that are approaches that help us to know the current state of the country’s economy. A relay factor for the study of macroeconomic accounting is production which constitutes the framework for determining growth and added offer.
GDP is the monetary value of final goods and services produced by an economy in a given period (approximately one year). The gross domestic product helps to measure the growth or decrease in the production of goods and services of the companies of each country, only within its territory. This indicator is a reflection of the competitiveness of companies. When mentioned final goods, it refers to those goods and services that the final consumer buys.
Payments to the factors include income from abroad;Adding the payments to the gross domestic product, the gross national product or PNB was determined.
The gross domestic product allows those responsible for the economic policy of the countries to judge whether the economy is expanding or contracting, if it needs an impulse or restriction, of the threat of inflation or recession is displayed on the horizon.
We can identify that if the Gross Domestic Product (GDP), indicates an evolution or growth, we will have parameters where the Mexican economy is growing, since the productivity of our country increases, through these results we can determine if more likely to find a good job of finding a good jobo Salary increase. By having an economic auspicious environment, greater confidence in the stability of the income and consumption of goods and services will arise.
Nominal GDP is measured market prices and real GDP is obtained at constant or variable prices and the net internal product considers the wear or depreciation of capital when used to produce to produce.
To determine GDP you have to consider the additional elements that are real GDP and nominal GDP;Real GDP calculation allows a useful inflation indicator known as GDP deflation. The deflator allows to determine the variation experienced by the prices between the base year and the year in question.
The economic growth rate is the percentage variation of the amount of goods and services produced by an economy from one year to another, with this information we can determine the economic well -being of a country, compare the exposition of the risk to change it by the monetary units carried out andeven carry out forecasts of the economic cycle.
Another measurement of GDP is through the income that companies pay to families for the productive resources they hire, within this income approach it is importantIdentity is equivalent to the amount paid for the use of resources, wages, interests, income and benefits.
To obtain GDP it is necessary to make adjustments, first, indirect taxes minus subsidies are added to modify the determination of costs at market prices and second, capital or depreciation consumption adds to move from the net internal product to the product to the productGross internal.
Determine correctly the calculation of the Gross Domestic Product (GDP), helps companies to make changes within them or know how to face a decrease in GDP. Companies use the forecasts or results of GDP to evaluate the situation of the economy and make decisions regarding the expansion of their activities, may think about investing in new franchises, machinery or businesses and generating more jobs, on the other hand you can knowThe behavior of prices and interest rates in the future, on the other hand send signals to know if we are at the right time to invest in our country;That is why the importance of having a correct calculation of GDP, since as companies we could make decisions that affect us in the competitive world and decline soon.
In conclusion, the Gross Domestic Product is the total of goods and services produced within a country (GDP) less the goods and services used in the production process. It is obtained by subtracting the consumption of fixed capital of the gross domestic product. Allowing to know the value of the new final production, when the part of the capital formation destined to replace the capital collection that stops having economic utility is suppressed.
The dissemination of the gross domestic product of a country is of the utmost importance, because through this you can know the health of the economy and have information for economic and political decision making.
The gross domestic product, the net domestic product, the nominal GDP, the real GDP, are calculations of the utmost importance, since they are measures that allow us to compare the production of the country with previous years, as well as with the production of other countries. Its calculation must be obtained with real numbers, with clear and precise investigations, because of these results great decisions are made nationwide, this demonstrates the productive capacity of a country.
References
- UNID, (S.f), macroeconomy, recovered from: https: // moodle2.UNID.Edu.mx/dts_cursos_mdl/execo/ae/ma/s02/ma02_lecture.PDF (October 2, 2019).
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