GDP and Inflation

GDP stands for Gross Domestic Product. The four main components of gross domestic product are
    1. Consumer spending for food, clothing, housing, and other aspects.
    2. Business spending for buildings, equipment, and inventory items.
    3. Government spending to pay employees and to buy supplies and other goods and services.
    4. The exports of a country less the imports into the country.


Inflation is when the price of goods and services increase. This reduces the buying power of the dollar. Interest rates represent the cost of money. Interest rates are influenced by the demand and supply of money