EXAM 3- GNP/ NIA/ questions

GNP means

Gross National product
- output by all u.s citizens no matter where they are

GNP formula- complex

GNP = GDP + (US income earned Abroad - foreign income earned in US)

GNP formula- original

Gross National Product= GDP + (net factor income from abroad)

Net factors income from abroad formual

(US income earned Abroad - foreign income earned in US)

NI stands for

National Income

NI formula - exp app.

C + IN + G + XN = NI

so its exp app -Depreciation

NI forumula simple

GDP - D = NI

NI forumula- Income app

W + R + I + P + tax on imports= NI

So its inc app.
- depreciation from the 2 non income charges

Income earned not received

- tax on imports
- SS taxes
- Corporate taxes
- R.E.

income received not earned

Transfer payments (ss, welfare)

personal income formula

NI

- tax on imports

-S Taxes

-R.E.

+Transfer payments

Disposable income formula

P.I. - personal taxes

savings formula

D.I. - consumption

what is the purpose of NIA

gauge economic performance globally

National income account define

income earned by the factors of production

gov bookkeeping system that measures the health of an economy, projected growth, economic activity, and development over a period of time.

how do you calcualte national income simplty

GDP - deprecation=

what is the personal income acc

income to households

two elements of gross invesment

D + IN= IG

two ways to calculate Disposable income

PI- person tax= D.I

C + S= D.I

what does change in real income or GDP mean

changes in OUTPUT only

what does changes in nominal income or nominal gdp mean

changes in price or in P + quantity

limitations to NIA

• underground eco (legal or illegal)

• market output

• environment

• quality of goods

• leisure time (work less hrs)

• per capita output