Final answer:
The total income received by a country's residents can be smaller or larger than the value of GDP, depending on net income from abroad and the consideration of Gross National Product (GNP). This differs by country, with the United States having a minor difference and smaller nations potentially having a substantial difference.
Step-by-step explanation:
The total income actually received by a country's residents can be either smaller or larger than the value of GDP and depends on whether you're considering Gross Domestic Product (GDP) or Gross National Product (GNP). GDP measures the value of economic activity within a country's borders, while GNP adds income from the country's businesses and labor abroad and subtracts the income that foreign businesses and labor in the country send back to other countries. If we consider national income, which is the sum of all income received for contributing resources to GDP, it is commonly referred to as national income (Y) and can be thought of as real GDP. Therefore, the total income received by a country's residents may vary when compared to GDP since this total income will also account for net income from abroad. For countries like the United States, the difference between GDP and national income is quite small, but for countries with a significant population working abroad, this difference can be substantial.