Meaning of few finance related term used in our surrounding

In our daily life through media or by someone else around us we used to hear some words frequently i.e GDP of India is slowing or world is going to face recession very soon or inflation is very high these days and likewise. We do understand that something is related to our economy but don't know the exact meaning so here is my attempt to explain you these term:

GDP(Gross Domestic Product)

This is the total market value of all the good and services produced  in a particular country or geographical boundary and which has been officially recognized but this should be in a given time frame i.e in a quarter or year  and which is equal to total sum of consumer, investment, government spending, (export-import). GDP includes goods produced by any company within a country territory irrespective of companies base/nationality i.e it may be a foreign based company or same nationality company. GDP is declared by government in every quarter i.e the last day of every quarter about its growth or downfall because it mainly represents the living standard of that country and also the health of country's economy and not the measure of  personal income. Important thing is that GDP and GNP(Gross National Product) are two different thing as in GNP we don't include the value of goods produced by the foreign company in a particular country/region but will include the value of goods produced by a company of particular nation having its office/manufacturing plant in another country. GDP calculation is done by two ways 1. By product produced method and 2. By income method.

Inflation

By the word itself we come to know that inflation is related to increase. Inflation is generally used in term of economics i.e for the increase in the rate of goods and services from time to time. This increase happens often due to increase in the supply of money or sometime may due to difference between supply and demand gap. As the inflation rate increases the value of money/currency decreases because for example if we were purchasing 2 chocolate for 1 rupee and due to high inflation rate after 2 years we are able to buy only 1 chocolate for 1 rupee so the value of rupee decreased in these 2 years. This is generally measured by General Price Index/Consumer Price Index(It is a inflammatory indicator which measures the change in the cost of goods and services including transportation, food, housing etc) and Producer Price Index/Wholesale Price Index(This is also a inflammatory indicator but it measures the change in value of whole sale prices which may mislead as a consumer may get things at higher rate despite of its low rate at wholesale level). Inflation is good for country growth but may effect country GDP when its too high.

Recession

It is a period when all economic activity see a slowdown for certain period. Recession effect is seen mainly in employment, industrial production, income, stock market etc decline. There is no one reason to blame that for recession but generally due to lack of government policies it occurs. If there is decline in GDP for two or more consecutive quarters than there are chances of recession knocking the door. In recession spending are reduced drastically so in that case government infuses money and increases its stake for removing recession

more to come......