GDP Gap

DEFINITION of 'GDP Gap'

The forfeited output of a country's economy resulting from the failure to create sufficient jobs for all those willing to work.

BREAKING DOWN 'GDP Gap'

A GDP gap denotes the amount of production that is irretrievably lost. The potential for higher production levels is wasted because there aren't enough jobs supplied.

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    Find out whether the nominal value of gross domestic product is sufficient for measuring the health of an economy and how ... Read Answer >>
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    Find out why real GDP allows economists to measure changes in the economic growth or decline of a country more accurately ... Read Answer >>
  3. When do economists use real GDP instead of GDP?

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  5. Is real GDP a better index of economic performance than GDP?

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