Gross Domestic Product Or Gdp Essay examples

904 Words Oct 16th, 2015 4 Pages
Gross Domestic Product or GDP is “the total market value of all final goods and services produced in an economy in a one-year period” (Colander p.141). It measures the size of a country’s economy as well as shows how new products or the improvement of existing products affect demand. GDP can also help determine the future development of products in an economy. It is most useful in calculating a country’s standard of living, the higher GDP rises the higher the standard of living for those in that economy rises as well. Since the Great Recession in 2008 the Obama administration has focused on finding ways to raise GDP. President Obama has added over 10 million private sector jobs which in turn has raised GDP because a greater labor force equates to more production which raises the level of GDP in an economy (Obama a). Recently, President Obama has proposed raising minimum wage in a continued effort to increase GDP (Obama a). Raising the minimum wage will increase consumer expenditure because people will have more money to purchase goods and services that are not solely categorized as basic necessities. This policy would fall under Keynesian economics because he believed low or falling wages actually contributes to a recession or depression instead of benefitting it. Households’ expenditures are restricted by their needs, when they receive a higher income they are likely to substitute savings over consumption. Republican Presidential Candidate Marco Rubio offers a different…

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