Economists calculate GDP by both the expenditure approach and the income approach Since the combined estimates from the two approaches produce a more accurate measure of GDP, economists typically employ both methods to calculate GDP.
What is the full form of GDP?
Full form of the word GDP is Gross Domestic Product. GDP is the total financial or market value of all finished products and services produced within a country's borders during a specific period of time. It acts as a precise gauge of total domestic output and a comprehensive report card on the state of a nation's economy.
- For instance, the building sector has expenditures that are incurred before there is revenue generated. Therefore, the spending strategy is more suited for this kind of industry.
In contrast, the revenue strategy is more suited for the service industry than the spending method.
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