Question

What are the international economic measurement techniques? Provide specific examples.

This assignment should be at least 3-5 pages.

Answer 1

International economic measurement techniques

It is very important to measure the international economic growth and its working in order to judge the economic level and how well the country is operating. Studying the economic conditions and its measurement is required so that organizations can take decisions to expand their operations internationally.

There are certain techniques that are followed by organizations in order to measure the international economic growth, such as:

• Gross domestic product: also written as GDP, it is a logical way to measure the economic growth in terms of the expenditure incurred by the country in a financial year. The overall production level of a country is measured and the revenue generated is compared to the expenditure incurred. For example a country can measure the dollar value of all the steel entered in the country, this can be done by adding the overall output of all industries, thus getting the gross domestic product for one year.
• Gross national product: also written as GNP is a tool which is used by economists in order to judge the amount of income earned by a country residents in an year and the way the income is channelized and utilized. For example a country can measure the income earned by residents of country in an year and can judge the level of growth rate of the economy.
• Comparing productivity to spending: another way to measure the economic condition of a country is by calculating the level of productivity in an year and comparing it to the spending rate of the residents of the country. The higher the productivity level, higher will be the standard of living of the residents hence better and meaningful spending.
• Measuring employment rate: another technique to judge the economy is by finding out the number of jobs available for youth and how many of them are employed in different jobs. The unemployment levels will have inverse relation with the economic health and condition of the country.