The difference between Gross Domestic Product and Net Domestic Product is:Group of answer choicesCapital consumption allowanceNational incomeEqual to the difference between full employment and natural employment rateReal GDP
Question
The difference between Gross Domestic Product and Net Domestic Product is:Group of answer choicesCapital consumption allowanceNational incomeEqual to the difference between full employment and natural employment rateReal GDP
Solution
The difference between Gross Domestic Product (GDP) and Net Domestic Product (NDP) is the Capital Consumption Allowance.
Here's a step-by-step explanation:
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Gross Domestic Product (GDP) is the total value of all goods and services produced within a country in a given period. It includes all private and public consumption, government outlays, investments, additions to private inventories, paid-in construction costs, and the foreign balance of trade.
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Net Domestic Product (NDP) is an annual measure of the economic output of a nation that is adjusted to account for depreciation, calculated by subtracting depreciation from the GDP. In other words, NDP equals the gross domestic product (GDP) minus depreciation on a country's capital goods.
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Capital Consumption Allowance, also known as depreciation, represents the amount of capital that would need to be set aside in order to replace worn-out or obsolete assets.
So, the difference between GDP and NDP is the Capital Consumption Allowance.
Similar Questions
Gross domestic product (GDP) is defined asMultiple Choicethe sum of all goods and services produced in a country during a year.the difference between exports and imports of a country.the increase in price of consumer goods and services over specified periods of time.the amount of goods and services produced for each hour worked.
Gross domestic product is the total market value of allGroup of answer choicesintermediate and final goods and services produced in a time period within a country.final goods and services produced in a time period within a country.goods but not services produced in a time period within a country.final goods and services produced in a time period by citizens of a country, both within the country and by its citizens working overseas.
Which of the following best defines Gross Domestic Product (GDP)?A.A) The total value of all goods and services produced over a specific time period within a country's borders, including foreign investments.B.B) The sum of all wages paid to employees, interest on loans, rents, and profits from businesses within a country's borders.C.C) The total market value of all final goods and services produced within a country's borders in a specific time period.D.D) The value of a country's exports minus its imports over a specific time period.
Gross Domestic Product- the total market value of all final goods and services produced annually in an economyChoose matching term1reserve requirement2GDP3contractionary policies4Federal Reserve System
Suppose GDP is $16 trillion, with $10 trillion coming from consumption, $2 trillion coming from gross investment, $3.5 trillion coming from government expenditures, and $500 billion coming from net exports. Also suppose that across the whole economy, depreciation (consumption of fixed capital) totals $1 trillion. From these figures, we see that net domestic product equals
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