GDP Growth Calculator
Compute Real and Nominal GDP growth rates. Features inflation adjustment and CAGR calculation for multi-year economic analysis.
Nominal Growth--
Real Growth (Inflation Adj.)--
CAGR (Annualized)--
Enter values to see economic analysis.
About
GDP Growth is the primary thermometer for economic performance, indicating whether an economy is expanding, stagnant, or in recession. However, nominal growth figures can be misleading due to currency devaluation. This calculator distinguishes between Nominal Growth (raw numbers) and Real Growth (adjusted for inflation/deflator), providing a technically accurate assessment of economic progress. It also computes the Compound Annual Growth Rate (CAGR) for periods exceeding one year, smoothing out volatility.
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Formulas
1. Nominal Growth Rate:
GDPfinal − GDPinitialGDPinitial × 100
2. Real GDP Adjustment:
GDPreal = GDPnominal1 + (Inflation / 100)
3. CAGR (Compound Annual Growth Rate):
(EndStart)1/n − 1
Reference Data
| Growth Rate (%) | Classification | Economic Context |
|---|---|---|
| −2.0% or less | Deep Recession | High unemployment, business closures (e.g., 2008 Crisis). |
| 0% to 2.0% | Stagnation | Slow movement, often below potential output. |
| 2.0% to 3.5% | Healthy Growth | Ideal range for developed economies. Sustainable. |
| 4.0% to 6.0% | Boom / Rapid | Common in developing markets or recovery phases. |
| 7.0%+ | Overheating | Risk of high inflation and subsequent bubbles. |
| Negative 2 Qtrs | Technical Recession | Standard definition of a recession. |
Frequently Asked Questions
If an economy grows by 5% but inflation is 6%, the country actually produced fewer goods and services than the year before. Real GDP strips out price effects to reveal the actual production capacity.
CAGR (Compound Annual Growth Rate) smoothes out the volatility of year-over-year changes. It answers the question: "If the economy grew at a steady rate every year to get from Point A to Point B, what would that rate be?"
Yes. "Overheating" occurs when demand outstrips supply capacity, leading to unmanageable inflation, asset bubbles, and eventual crashes (boom-and-bust cycles).
It is a measure of the price level of all new, domestically produced, final goods and services in an economy. It is a broader inflation measure than the CPI.