Technical Note

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                       Technical Note
                   Gross Domestic Product
               Third Quarter of 2005 (Final)
                     December 21, 2005

  This technical note provides background information about the source data and
  estimating methods used to produce the estimates presented in the GDP news release.
  The complete set of estimates for the third quarter is available on BEA's Web site at
  www.bea.gov; a brief summary of "highlights" is also posted on the Web site.  In a few
  weeks, the estimates will be published in BEA's monthly journal, the Survey of Current
  Business, along with a more detailed analysis of the estimates ("The Business
  Situation").

  Sources of Revision to Components of Real GDP

  Real GDP growth in the third quarter was 4.1 percent, which was 0.2 percentage point
  less than that in the preliminary estimate.  The downward revision to real GDP reflected
  offsetting revisions to several components:

       ·       Personal consumption spending for durable goods was revised down, reflecting
               revised and newly available motor vehicle data from trade sources.
       ·       There were small downward revisions to several other components of GDP.
       ·       Exports of services were revised up, reflecting revised second- and third-quarter
               estimates from BEA's international transactions accounts.

  The price index for gross domestic purchases increased 4.2 percent in the third quarter,
  0.2 percentage point more than in the preliminary estimate.  The price index for
  residential investment was revised up, reflecting a revision to the Census Bureau price
  index of new one-family houses under construction.

  Corporate Profits

  Profits from current production decreased $54.4 billion, or 4.0 percent, in the third
  quarter, compared with an increase of $59.3 billion, or 4.6 percent, in the second.  Third-
  quarter profits were reduced by $165.3 billion (at an annual rate) because of Hurricanes
  Katrina and Rita, reflecting the net benefits paid by domestic insurance companies and
  the uninsured losses of corporate property.  For further information on the treatment of
  the hurricanes in the national accounts, see the FAQs available on BEA's Web site,
  www.bea.gov.

  In the third quarter, real gross value added of nonfinancial corporate business increased,
  and profits per unit of real value added decreased.  Effective with today's release, the
  estimates of real gross value added of nonfinancial corporate business were revised
  beginning with 2002, reflecting the use of a revised deflator for nonfinancial industries
  from the annual revision of the GDP-by-industry accounts.

  Brent R. Moulton
  Associate Director for National Economic Accounts
  Bureau of Economic Analysis
  (202) 606-9606
	  

Last updated: Wednesday, April 15, 2015