Rolnge

What the heck is this GDP? And why America’s GDP is less 

than India’s?

Hello everybody! I know most of you people are aware of the answer of above mentioned question so this article is not for you. But I had written this article for people who really has confusion over America’s GDP and could not understand how GDP really affects on our country. Ok, so let’s begin.

So friends GDP means Gross Domestic Product.

In easy way, the GDP is just the net worth of a country per year.

India’s GDP is approx 2.9 trillions USD.

America’s GDP is approx 20.58 trillions USD.

China’s GDP is 13.37 trillions USD.

What is this percentage thing in this GDP?

See, percentage means increase in the earning this time than previous time.

Means if a country had earn 100 dollar this year and in another year it had earn 120 dollar than we will say that it had a GDP growth rate of 20%.

So, why to be panic with low GDP rate? After all it is increasing.

You would have definitely heard from your grandfather or some other old person that in their time they use to buy thing at very low rate. Because day by day, hour by hour and second by second inflation rate is hiking. So earning 50K 50 years back and earning 50K today had a huge difference. Therefore GDP of the country should always in profit after subtracting inflation rate from it.

For example, GDP growth of a country A is 4% and inflation rate is 3% than it means country’s real GDP growth is 1% compare to previous year. Means country is unable to make good money and becoming a slow growing economy in the world. Consequently, it rate of development in very slow.

How America being a superpower had less GDP growth rate than India’s?

See, I want you to be clear between the GDP and GDP growth rate.

GDP- total earning

GDP growth rate (%)-increasing in earning.

So I had told you America had nearly 22 trillion economy at present. Therefore 2% growth rate does not means that America is earning less or growing slow.

For example:
Person A: earns 1 rupee in first day

 In second day- he earns 2 rupees

So increase in earning (%) - 100%

Person B: earning on first day- 10 rupees

On second day- 15 rupees

Growth rate - 50%

So which one better? 50% or 100%.

So I hope I was successful in explaining you about GDP.

So at present china is fastest growing economy (6.4%).

There was a time when India was having the title of fastest growing economy but due to some reasons it loose.

So if you have any opinion for me than please benefit me.

Thanks for your time.

-          By Aadersh chaubey