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Many factors or indicators can affect or be used to measure the economies of the world. This article explains these factors\/indicators and explains how they effect the global economies.<\/em><\/p>\n \n Creation of Money<\/a><\/span><\/p>\n Gross Domestic Product<\/a><\/span><\/p>\n Official Exchange Rate GDP<\/a><\/span><\/p>\n Purchasing Power Parity GDP<\/a><\/span><\/p>\n Difference and accuracy of OER and PPP<\/a><\/span><\/p>\n Calculating GDP<\/a><\/span><\/p>\n Economic Growth<\/a><\/span><\/p>\n Calculating Aggregate Demand<\/a><\/span><\/p>\n Interactive Map of Global Economies<\/a><\/span><\/p>\n GDP growth (annual %)<\/a><\/span><\/p>\n Gross savings (% of GDP)<\/a><\/span><\/p>\n Current account balance (BoP, current US$)<\/a><\/span><\/p>\n Government Borrowing<\/a><\/span><\/p>\n The World Bank<\/a><\/span><\/p>\n The International Monetary Fund (IMF)<\/a><\/span><\/p>\n Government Bonds<\/a><\/span><\/p>\n Interactive Map of National Debt<\/a><\/span><\/p>\n Central Government Debt, Total (% of GDP)<\/a><\/span><\/p>\n External Debt Stocks, Total (DOD, current US$)<\/a><\/span><\/p>\n \u00a0<\/span><\/p>\n \u00a0<\/span>\u00a0<\/span><\/p>\n \u00a0<\/span><\/p>\n \u00a0<\/span><\/p>\n \n \n \u00a0<\/span><\/p>\n Thousands of years ago various goods and services would have been bartered or swapped for other such items as required. A fisherman who had a good day may have far too many fish which without the storage facilities the fish would be wasted, however these excess goods were traded for other goods or services that were required.<\/span><\/p>\n As far back as 12,000 BC the Earliest civilisation in Anatolia (modern day Asian part of Turkey) used to barter with obsidian or cows for goods and services. These items were very useful in their time (the stone obsidian was turned into tools or weapons) which is why they were largely accepted in payment. <\/span><\/p>\n It is believed that cowrie shells had been used in China as currency from around 2,500 BC but by around 1,200 BC various Kingdoms within China had created coins which had set values and created for the sole purpose of trade. This could be argued as the first form of money as we know it today. The original coins were not round and came in many shapes including spades and swords. The first form of round money was created in 210 BC by the first emperor of China, Qin Shi Huang.<\/span><\/p>\n \u00a0<\/span><\/p>\n One of the most commonly used factors or indicators as to how well global economies are doing is a nations Gross domestic Product or GDP. <\/span><\/p>\n The Gross domestic Product or GDP of a country is the value of all its goods and services produced in a given year. The value of a nation\u2019s GDP is the value of its economy and indication of its wealth. To allow for accurate comparison of various countries GDP the value is converted into a single currency – usually US$. <\/span><\/p>\n \u00a0<\/span><\/p>\n \u00a0<\/span><\/p>\n The given GDP of a country is normally based on the value of goods and services as valued in that country. It is considered the most accurate way of judging a countries economic power<\/strong> and is used to calculate the official exchange rate of the country\u2019s currency.<\/span><\/p>\n \u00a0<\/span><\/p>\n An alternative way of calculating the GDP of several nations is to calculate the value of goods and services based on their value in a single country (usually the US). This is considered a better way of comparing the living conditions<\/strong> of several countries. For example a tonne of wheat or million barrels of oil are given the same monetary value using the Purchasing Power Parity (PPP) method but this would vary using the Official Exchange Rate (OER) method.<\/span><\/p>\n \u00a0<\/span><\/p>\n The Official Exchange Rate method is more accurate as goods and services in different countries vary somewhat and generally do have a different monetary value. A battleship, for example, produced in a less developed country is likely to be of less quality or with less technology than that produced in a more technologically advanced country and therefore have more value but using the PPP method it is likely to be considered equal.<\/span><\/p>\n \u00a0<\/span><\/p>\n Many factors affect countries GDP including but not limited to, trust in the market, population growth, disease, infrastructure, weather, natural disasters and war etc. This makes GDP very difficult to predict but it is can be fairly accurately calculated retrospectively using the following equation.<\/span><\/p>\n \u00a0<\/span><\/p>\n GDP = C + P + G + ( X – M )<\/span><\/p>\n \u00a0<\/span><\/p>\n C = Consumer spending on goods and service <\/span><\/p>\n P = Private company spending on goods and services<\/span><\/p>\n G= Government spending<\/span><\/p>\n X = Exports<\/span><\/p>\n<\/a>The Creation of Money<\/span><\/h2>\n
<\/a>Gross Domestic Product<\/span><\/h2>\n
<\/a>GDP (Official Exchange Rate)<\/span><\/h2>\n
<\/a>GDP (Purchasing Power Parity)<\/span><\/h2>\n
<\/a>Difference and accuracy of OER and PPP<\/span><\/h2>\n
<\/a>Calculating GDP<\/span><\/h2>\n