posted 1 year ago last edited 6 days Ch 10 Made in the USA W

posted 1 year ago (last edited 6 days Ch. 10. Made in the USA What are some reasons that we primaily use GDP instead of GNP to measure economic health of a country? What adds to the complexities of each measure?

Solution

Answer : GDP is the best measurement of the economic growth.As it has been estimated market value of goods and services in particular country.It has been taken into account overseas production income earned by domestic residents where as income earned inside as well as aboard investment. The primary reason for which GDP is considered as best measure because they taken into account the production of their countries and not transactions from outside.

GNP measure economic wealth of the country where as GDP measure economic growth of the country.

GNP has been calculated on the basis of production in a country for perfection where GNP has been calculated on the basis of country wealth and taken into account net income earned from abroad by the domestic residents.

GNP is more complex and difficult.

GNP is less accurate than GDP.

GNP is calculate on the basis of Income earned outside the country where as GDP is calculate on the basis of production inside the country.