01-02-2013, 01:02 PM
Recent Trends in World Trade
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Meaning of Economic Growth
Economic growth is the increase in the amount of goods and services produced by an economy over a period of time.
It is measured as the percentage increase in real GDP.
Meaning of real GDP:
Real GDP is a nation’s total output of goods & services, adjusted for price changes.
Here's an example: suppose in year 1 a country produced a total of five goods priced at Rs.10 each, or Rs50 total. In year 2, it produced the same five goods, but the price rose to Rs12, or Rs60 total. Assume year 1 is the base year used to calculate real GDP. In year 1, nominal GDP was Rs50 and real GDP was also Rs50. In year 2, nominal GDP was Rs60; but real GDP was only Rs50, because in constant (year one) Rupees, only R50 in goods were produced.
Prospects for 2012-2013
The outlook for world trade seems to be darkened because of the ongoing sovereign debt crisis in Europe.
Emerging and developing countries would certainly be adversely affected by falling import demand in the European Union, which is the single largest market for their exports.