Question

What is one way that gross domestic product differs from gross national product?a. GDP does not account for depreciation and GNP doesb. GDP includes the pre-tax income paid to US households and GNP does notc. GDP does not include income earned outside the US by US firms and citizens and GNP doesd. GDP does not include the value of capital equipment and GNP does

Answer 1

Answer: Option(c) is correct.

Step-by-step explanation:

GDP does not include net factor income from abroad whereas GNP includes the income that is earned from outside the home country by the firms and citizens.

As GDP involves all the income that is earned within the boundaries of a country.

On the other hand, GNP includes all the income that is earned within the boundaries of a country and outside the home country.

Hence, this is the one way that Gross Domestic Product is differs from Gross National Product.