Income Approach to Calculating GDP
Find the information on GDP in billions of current dollars for the past four quarters. In U.S. Economic Accounts under National click on Gross Domestic Product (GDP), then click on Interactive Tables: GDP and the National Income and Product Account (NIPA) Historical Tables - click "Begin using the data"- choose Section 1: Domestic Product and Income and find table 1.7.5
Create the table that contains the following information quarterly. Omit the intermediate lines found in Table 1.7.5 on the web site.
Gross domestic product
Gross national product
Net national product
National income
Personal income
Write a report in your own words (1 page, double-spaced), which contains the analysis of the results you received. In this report consider, but do not be limited to the following:
1. What is the difference between gross domestic product (GDP) and gross national product (GNP)? What is the difference in what GDP measures compared to GNP?
2. Based on the table, what calculations must you make to determine GNP from GDP?
3. What is national income (NI)? What does NI measure?
4. Which was higher in this year, GNP or NI? By how much?
5. What calculations must you make to determine NI from GNP?
6. NI is composed of a number of categories. What category makes up the largest portion of NI?