GDP equation expenditure method
TE = C + I + G + X - M
What occurs at market equilibrium?
TE = TY = TO
standard of living equation
real GNP / population
GDP + net property income from abroad
GNP - capital consumption
value of all final goods and services produced in an economy during a given time period
difference between GDP and GNP?
- GNP takes into account income earned by a country's citizens abroad and money sent abroad
- GDP only accounts for the income earned within a country