Gross

domestic product (GDP) refers to the market value of all final goods and services produced in a country in a given period. GDP per capita is often considered an indicator of a country's standard of living.

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 GDP

can be determined in three ways-

Product approach

Income approach

Expenditure approach

The most direct of the three is the product approach, which sums the outputs of every class of enterprise to arrive at the total. The expenditure approach works on the principle that all of the product must be bought by somebody. Therefore the value of the total product must be equal to people's total expenditures in buying things.

The expenditure method: GDP = private consumption + gross investment + government spending + (exports imports) or GDP=C+I+G+(ex -I)

The income approach works on the principle that the incomes of the productive factors must be equal to the value of their product, and determines GDP by finding the sum of all producers' incomes.
GDP = compensation of employees + gross operating surplus + gross mixed income + taxes less subsidies on production and imports GDP = COE + GOS + GMI + TP & M SP & M

India's economy grew by just 7.8 per cent in the fourth quarter ending March this year. However, economic growth, as measured by gdp improved to 8.5 per cent in 2010-11 from 8 per cent in 2009-10. Meanwhile, the GDP growth figures for the first and third quarters of FY'11 have been revised upward. The slowdown is expected to continue as India's central bank continues to raise interest rates to control inflation. Inflation in July was 9.22%, which was well above the RBI's target rate of 4% to 4.5%. While the GDP growth figure for Quarter 1 has been pegged at 9.3 per cent as against the earlier estimate of 8.9 per cent. Q3 GDP growth has been revised upward to 8.3 per cent from 8.2 per cent.

Farm output rose 3.9%, which was down from the previous quarter. The manufacturing sector grew 7.2%, but well below the 10.6% in the second quarter of 2010. The agriculture and allied sectors grew by 6.6percent during the fiscal. The growth of services, including banking and in.surance, improved to 9.9 per cent in 2010-11.

The trade, hotels, transport and communication segment grew by 10.3 per cent in FY'11, as against 9.7 per cent last fiscal. while growth of the construction sector stood at 8.1 per cent, as against 7 per cent in the previous financial year.