OTHER NATIONAL INCOME & PRODUCT ACCOUNTS

Besides GDP there are also

5 COMMON ACCOUNTS

Gross National Product Net National Product National Income Personal Income Disposable Personal Income

GROSS NATIONAL PRODUCT

UNTIL DECEMBER 1991

The Commerce Department used Gross National Product to measure the US economy.

GNP Measures the total dollar value of all final output produced with factors of production owned by residents of a country during one year

This is when we DO COUNT plants/manufacturers in other countries

GROSS NATIONAL PRODUCT

The United Nations and most countries use GDP as the primary measure of economic production.

Switched from GNP to GDP in 1991

The change has made it easier for US economists and business firms to make international economic comparisons.

NET NATIONAL PRODUCT

This includes money spent on replacing defecting or outdated equipment and machinery.

When this depreciation is subtracted from GNP, the result is a nation’s NET NATIONAL PRODUCT.

NET NATIONAL INCOME

To determine the total income paid to the owners of a nation’s factors of production, economists use the measure of national income.

The sum of employees’ and proprietors’ income, real and estimated rental income, corporate profits, and net interest.

PERSONAL INCOME

Sometimes we are interested in the total amount of income earned by people in a given nation.

National Income – Income that does NOT go to people (profits, taxes, SS) + Social Security Checks Paid = Personal Income

DISPOSABLE PERSONAL INCOME

What is the difference between GROSS PAY and NET PAY?

Disposable = the total amount of income available to a nation’s people to spend or save

Calculated by subtracting out personal taxes