Net domestic product (NDP) is a fundamental economic gauge that measures the value of all goods and services produced within a country’s borders over a specific period. It serves as a key indicator of a nation’s economic health, reflecting its overall productive capacity.
Calculating NDP is crucial for policymakers, economists, and business leaders. Understanding how it’s determined empowers them to make informed decisions, assess economic performance, and forecast future trends. Historically, NDP played a pivotal role in the development of national accounting systems and the emergence of macroeconomics as a discipline.