1. The gross domestic product is one of the primary indicators used to gauge the health of the country’s economy. It represents the total dollar value of all good and service produced over a period of time. To make sure that GDP can be most accurately compared year-to-year, the Bureau of Economic Analysis is interested in calculating and reports the GDP. Also the people in the country are interested in gross domestic product. The government is also interested in selecting companies that are steady, not small ones.
2. For GDP to be collected, the BEA makes three important distinctions. First they collect from the U.S.’s import and income from the companies. When they collect GDP, the effects of inflation are taken out. Also the only final product gets counted. The GDP is measured quarterly and thats how it receives better data. Much of the data used in GDP is collected by sending out surveys to different companies. There are surveys sent to retailers and manufacturers to ask about their output or sales in a monthly basis.
3. In 2008 and 2009, the economy contracted for four consecutive quarters. The Great Depression was the last time it happened, and now it is happening now. The economy fell .7% in Q1 with the Bear Stearns bailout, but resumed 1.5% growth by Q2. When the banking system was decreasing in the third quarter, the economy shrank 2.7%. The Lehman Brothers collapse delivered the death blow - the economy dropped 5.4% in Q4. The GDP collapsed 6.4% in Q1 2009. By the second quarter, the economic stimulus package started to work, and the economy fell only .7% in Q2. It finally grew again by 2.2% in Q3.