Gross Domestic Product
In this document, readers will be presented with the concept of macroeconomic and its involvement in the development of a gross domestic product. Macroeconomics deals with the routine, arrangement, performance, and management of an economy. It includes national, provincial, and international economies.
The most important measure of economic activity in a country is the Gross Domestic Product (GDP). The GDP of any country can be improved by increasing its disbursement, production, and profit. To measure the GDP of any country, one needs a consequential aggregation of all categories of manufactured produced. The territory's manufactured products are the crossing result of effective demand, the capabilities of productions, and profits. The revenue can be generated from the payments dispersed to production part, and it offers the necessary investment.
McEachern (2011) while explaining the techniques to enhance the rate of gross domestic product stated that to improve the level of GDP in near future, consumers will have to spend less save more. The traders should invest more in the capital goods. If possessions are invested into empowering an economy now, then the future generations will enjoy a higher level of GDP in the country. The expansion of production at rates quicker than the country’s population growth provides an opportunity to enjoy a higher gross domestic product. As more people are engaged in employment, the economic resources increases, the level of education increases, the class of capital gets better, the technology increases, and the dynamic capability of the financial system such as Gross domestic product increases. The increase in economic growth caused by the more competent use of resources helps in improving the GDP of a country (McEachern, 2011).
The growth of gross domestic product is caused by two most important factors; the first one is the increase in the demand of local demand and the second one is the increment in the exportation of locally assembled products.
It is clearly being established that government institutions such as monetary funding organizations and state banks are the some of the major source of the GDP growth of the country. The most familiar GDP social trend is an incessant intensification with phases of acceleration and deceleration. According to Arndt (2011), government organizations have a significant influence on reserves in the substantial and human capital, equipment, and manufacturing industries (Arndt, 2011). It is well understood that these government organizations are having a decisive role in the growth of GDP as governmental organization plays an important role in the appropriate allocation of resources.
The effect on the GDP growth of the country is constructive if the political leaders are honestly distributing the resources and inflation rates are according to the requirement of the financial system the country. If a political force of a country is based on corruption and bribery, then it is going to badly affect the economic system of the country. It is a reason why many countries in the Asian and African region are still not able to become a progressive nation as their economic system is much weaker because of the corruption in the governmental organizations. Education appears to play a crucial role in improving the rate of gross domestic product of a country.
According to Reinhart and Rogoff (2010), the disbursement of civilians on household products helps in improving the GDP of a country (Reinhart & Rogoff, 2010). If citizens of the country will spend according to the requirement and will prefer to buy locally assembled products, then it is going to have a positive impact on the growth of GDP. If people will not save their money or they will not invest money in business and trading sector, then it is going to have a negative impact on the growth of a GDP in a country. The ratio of employments even directly affects the rate of GDP, if the majority of the people in a country will be employed, then the rate of GDP will determinedly increase otherwise it going to have a negative effect on the GDP growth of the country.
Social-ethical responsibility policy is based on theory, in which citizens are held responsible for satisfying their civic duty. The actions of civilians should play a vital role in stabilizing the economic system of their country, which in return will help in improving the rate of GDP. It is a responsibility of individual, in a country to pay their taxes on times. The civilians should not get involved in smuggling as it badly affects the financial growth of the country. It is a social-ethical responsibility of individuals to keep a balance between financial growth and welfare of society. When there is an equilibrium attained in this, then it could be stated that social responsibility is achieved.
GDP of the country can be improved by adding dissimilar kinds of manufactured goods into a single appraisal of the significance of economic activity. The growth of GDP is directly dependent on the consumption of locally manufactured products. To improve the GDP of a country, traders should manufacture high-quality products so people will take more interest in buying local products. The rise in demand of exportation of the locally assembled product even helps in improving the GDP of a country.
References
Arndt, H. W. (2011). The Role of Political Leadership in Economic Development. Canadian Journal of Development Studies , 5 (1), 51-63.
McEachern, W. A. (2011). ECON: MACRO3. New York: South-Western College Publications.
Reinhart, C. M., & Rogoff, K. S. (2010). rowth in a Time of Debt (Digest Summary). American Economic Review , 100 (2), 573-578.
