# A Three definitions of GDP - detailed breakdown

Back to chapter 1: “Three definitions of GDP”

$\text{Production of private firms}_{\text{at producer prices} }\\ + \text{Production of households and private} \\ \text{non-profit organisations}_{\text{at producer prices}} \\ + \text{Production of the state}_{\text{at production cost}} \\ + \text{Indirect taxes less subsidies}$ $\mathbf{\text{Gross domestic product}_{\text{at market prices}}}$

$=$

$\text{Private consumption} \\ + \text{Government consumption expenditure} \\ + \text{Investment in equipments} \\ + \text{Investment in buildings} \\ + \text{Other investments} \\ + \text{Changes in inventories and net acquisition of valuables} \\ + \text{Exports of goods and services} \\ – \text{Imports of goods and services}$

$\mathbf{\text{Gross domestic product}_{\text{at market prices}}}$

$- \text{Indirect taxes} \\ + \text{Subsidies}$ $=$ $\mathbf{\text{Gross domestic product}_{\text{at factor income}}}$

$+ \text{Balance of primary income with the rest of the world}$ $=\mathbf{\text{Gross national income}}$ $– \text{Depreciation}$ $= \mathbf{\text{Net national income}}$