Gross Domestic Product (GDP) measures the total market value of final goods and services produced within a country during a given period.
Why it matters:
- it is a broad measure of economic activity
- rising GDP usually signals expansion
- falling GDP often signals weakness or recession
Important detail:
- GDP counts final output to avoid double counting
- it focuses on production within the country
GDP is a core indicator when studying the Business Cycle and the Inflation Index.