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Gdp Paper

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GDP (or Gross Domestic Product), is defined as, “aggregate output as the dollar value of all final goods and services produced within the borders of a country during a specific period of time, typically a year” (McConnell, Brue, & Flynn, 2012). This measures the value of the output in monetary terms, and you can check current trends of the GDP by taking a look at the Bureau of Economic Analysis document GDP decline in First Quarter.

In the BEA release highlights document, you can see a decrease in the GDP in the first quarter of 2014, which caused corporate profits to decline drastically. The document states that “decreased 13.0 percent in the first quarter of 2014, according to the “second” estimate released by the Bureau of Economic Analysis”. In the fourth quarter of 2013, real GDP increased 2.6 percent. The first-quarter real GDP growth rate was revised down 1.1 percentage point from the advanced estimate released in April” (2014, bea.gov). Within the highlights, it mentions how the main driver of the decline was a “significant decline in inventory investment, notably by motor vehicle dealerships.” It also makes note that real final sales of domestic product rose 0.6 percent in the first quarter (2014, bea.gov). The BEA release highlights further note that declines in exports, in business investments, state and local government spending, and in housing investment contributed to the first quarter real GDP decline (2014, bea.gov). However, consumer spending in health care and in home utilities increased in the first quarter. Profits of financial corporations fell 15.0 percent in the first quarter after rising 1.3 percent, whereas profits of nonfinancial corporations fell 8.1 percent after rising 1.5 percent, with profits from the rest of the world decreasing 9.1 percent after rising 5.5 percent. The time period that shows the most significant...

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