Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Per Capita GDP

What it is:

Per capita GDP is a country's gross domestic product (GDP) per person. The formula for per capita GDP is:

Per Capita GDP =Gross Domestic Product/Population

How it works (Example):

For example, let's assume that Country XYZ has $100 trillion in gross domestic product and 250 million people. According to the formula, Country XYZ's net GDP per capita is:

Per Capita GDP = $100,000,000,000,000/250,000,000 = $400,000

Why it Matters:

Gross domestic product is a macroeconomic measure of output. This measure helps analysts and investors get a better feel for whether a country is more or less productive and in turn whether it is headed for a recession or a bull market. The per capita measure of GDP indicates whether the country's workforce is generally becoming more or less productive -- that is, whether the country's workforce is efficiently producing goods and services that consumers want.