Beyond GDP: other ways to measure the economy
- Gross national product, or GNP, includes what is produced domestically and what is produced by domestic labor and business abroad in a year.
- National income includes all income earned: wages, profits, rent, and profit income.
- Net national product, or NNP, is GNP minus depreciation.
- Depreciation is the process by which capital ages over time and therefore loses its value.
Gross national product
Net national product
Calculating GDP, net exports, and NNP
|Government purchases||$120 billion|
|Business investment||$60 billion|
|Income receipts from rest of the world||$10 billion|
|Income payments to rest of the world||$8 billion|