Gross Domestic Product (gdp) of Usa

Published: 2021-09-14 20:15:09
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IntroductionUnited States (US) is the most prosperous mixed market economy in the world with a gross domestic product (GDP) of $19.36 trillion as of 2017. It is ranked 1st in terms of nominal GDP and 2nd for purchasing power parity (PPP). The population of USA is at 326 million with an unemployment rate as low as 4.1% and the highest external debt of any country which is estimated at $18.62 trillion. The great recession in 2008 caused the financial market to collapse and high unemployment rate. Furthermore, United States recorded the largest decline in trade deficit of $501 billion which represented 3.5% of the country’s GDP. (Norris, 2010) There are 5 major industries driving the economy which are energy, manufacturing, transport, healthcare and agriculture. Energy such as oil and gas production have increased dramatically due to technology advancement in drilling and hydraulic fracturing of shale formations which led to the creation of 2.1 million new jobs. Manufacturing industry contribute $2.09 trillion to the economy which accounts for 12% of total GDP and supports 17.6 million U.S. jobs. Consumer expenditure totalled $1.33 trillion in 2012 in the transportation industry such as air, maritime and trucking services which represents 8.5% of the annual GDP. In 2013, the healthcare industry enjoyed a 135% 3 year growth rate and brought in $21.8 billion which makes it one of the fastest-growing industries in the US. The agriculture sector was one of few industries that performed well during both the recession and recovery period. In 2014, US exported $152.5 billion worth of agricultural goods and it has scaled 41% in value over the past five years. In 2013, 16.9 million jobs were attributed to the agriculture sector which accounts for 9.2% of total U.S. employment. (Deutsch, n.d.) Production output performance analysis[pic 1]Figure 1.1 (Trading Economics, n.d.)                                                                                                       [pic 2]Figure 1.2 (Trading Economics, n.d.)[pic 3]Figure 1.3 (Trading Economics, n.d.)With reference to figure 1.1, the United States GDP has grown by 117% over the last 10 years, from US$14.7T to US$17.25T. Q1 and Q2 of 2009 has the lowest GDP of US$14.4T With reference to figure 1.2, the real GDP growth rate is generally positive with the exception of mid of 2008 to end of 2009. This rapid dip was due to the global financial crisis and the aftermath of subprime mortgage crisis of 2006 and the banking liquidity crisis of 2007. (Amadeo, 2018) The recession has reduced the purchasing power of consumer due to the fall in disposable income. This has resulted in a fall in annual average consumer spending by 3.1% to $48109. However, average prices over this period have risen by 5.2% thus real consumer spending has fallen by almost 8%. (Economist, 2011)  GDP per capita measures the standard of living of a person within the country. With reference to figure 1.3, the GDP per capita of United States has grown by 109.7% from 2009 to 2016. The lowest point was in 2009 where US economy was badly hit by the great recession. Fortunately it recovered quickly and bounce back to achieve where it is today. The above figures show a decline or economic downturn in 2009 and improved significantly thereafter. It can be attributed to several government policies that was introduced to bring United States out of depression.

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