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October 23, 2007

The big economic measure

Many economic measures come out every month, but there's one that deserves more attention than others. N.C. State University's Mike Walden explains. Listen

"There are lots of measures that come out every month: income measures, retail sales, various employment numbers, measures on consumer confidence [and] price measures. But sort of the granddaddy or grandmother of them all, economists would argue, is a measure called gross domestic product," says Dr. Walden, a professor of agricultural and resource economics. "And that is simply the value of everything that we produce at a given period of time, both goods and services.

"It includes only the value produced in the U.S. ... regardless of who actually owns the factory or company," he adds. "And we think this is the broadest measure of our economy and probably gives us the ... broadest gauge ... of economic activity.

"So when that measure goes up we say the economy is expanding, and when it goes down it's obviously contrasting. And right now our gross domestic product on an annualized basis is around $12 trillion in the nation, and in North Carolina it's about $350 billion. And we are by far -- by leaps and bounds -- the largest economy in the world based on this value."

Posted by deeshore at October 23, 2007 08:00 AM