What is the difference between GDP and HNP?

Gross domestic product (GDP) and gross national product (GNP) are macroeconomic conditions related to the value of goods. The difference between GDP and HNP is that while GDP is more focused on the value of goods produced within the territorial borders of the country, HNP deals with the total value of goods produced by the country's citizens, regardless of the place. Another difference between GDP and HNP is that GDP is considering producing all people in the country, regardless of whether they are nationals of this country, while HNP considers only the production of its nationals. GDP is also the main or primary macroeconomic factor used by most world governments to assess their economies.

The reason why GDP is the preferred index for monitoring the health of the country is due to other important macroeconomic factors such as the level of national production and the influence of demand and supply on the value of these goods. HNPIt is external and can be used for purposes that include the evaluation of citizens' income in the country for tax purposes and further considerations. GDP can also serve as an indicator of imminent inflation, deflation, recession or economic boom. An example of the difference between GDP and HNP is a citizen or a resident of the United States who invest in Britain, Ghana, Dubai and Tokyo. The proceeds from these investments will be included in GNP calculations, but GDP calculations will be more focused on these investments in the United States.

GDP and GNP differ because GDP monitors the goods that are produced in the ground from pre -production to production to assign it value. For example, GDP measures the demand for finished goods within the cycle and brings raw materials that have been used well in production. An example is the chocolate bar, which is a finished product. GDP will only assess the value of the chocolate bar and not cocoa, sugar or other ingredients used in its production, as it will calculate these raw materials twice. Raw material values ​​areIn their nominal value, in their nominal value, unless the raw materials were used at the end of this GDP cycle.