CALCULATION OF

GDP/
GROSS DOMESTIC
PRODUCT
PRESENTED BY: MAYVELLE SOLIS
 GROSS DOMESTIC PRODUCT
the total monetary or market value of
all the finished products produced
with a country's borders within a
period
 3 WAYS TO
COMPUTE GDP

INCOME APPROACH
,EXPENDITURE APPROACH
AND PRODUCTION
APPROACH
 INCOME APPROACH

The income approach calculates GDP by summing up the

incomes earned by individuals and businesses during a
specific period.

GDP = Employee Compensation + Rents + Interest +

Proprietors' Income + Corporate Profits + Taxes on
Production and Imports - Subsidies
 EXAMPLE:
- Employee Compensation: 1,200,000 PHP
- Rents: 100,000 PHP
- Interest: 150,000 PHP
- Proprietors' Income: 300,000 PHP
- Corporate Profits: 500,000 PHP
- Taxes on Production and Imports: 200,000 PHP
- Subsidies: 50,000 PHP
GDP = 1,200,000 PHP + 100,000 PHP + 150,000 PHP + 300,000 PHP + 500,000 PHP +
200,000 PHP - 50,000 PHP

GDP = 2,400,000 PHP

 EXPENDITURE APPROACH
The expenditure approach
calculates GDP by summing up
the expenditures on final goods
and services within a specific
period.

GDP = C + I +
G + (X - M)
EXAMPLE
- Personal consumption expenditures (C): PHP. 1,000,000
- Gross private domestic investment (I): PHP.500,000
- Government consumption and gross investment (G): PHP.
300,000
- Exports (X):PHP. 200,000
- Imports (M): PHP. 100,000
GDP = 1,000,000 PHP + 500,000 PHP + 300,000 PHP +
(200,000 PHP - 100,000 PHP)

GDP = 1,900,000 PHP

 PRODUCTION(OUTPUT)
APPROACH
Also known as the output or value-added
approach, it calculates the total value
of all goods and services produced in a
country within a specific time period.

GDP = Value of Final Goods

and Services - Value of
Intermediate Goods and
Services
 EXAMPLE:
- Stage 1: A farmer grows rice and sells it to a rice mill for 100,000
PHP.
- Stage 2: The rice mill processes the rice and sells it to consumers for
200,000 PHP

GDP = 200,000 PHP (Value of Final Goods and Services)

- 100,000 PHP (Value of Intermediate Goods and
Services)

GDP = 100,000 PHP