GDP,+National+Income,+GNP,+and+GNI


 * GDP, National Income, GNP, and GNI**

All of these topics are interrelated somehow and are very important topics when it comes to economics and everyday life. GDP or gross domestic is how many goods or services a country is producing at a certain period in time. GDP can be an excellent way to measure a country’s standard of living and growth. It is important for there to be growth in production in order to keep up with Canada’s increasing population. This is why a higher GDP helps to improve the standard of living. Canada’s growth rate as of 2007 is 1.9% it ranks 100th in comparison to other countries. Unfortunately GDP does not capture all of a countries production because some businesses may produce products in other nations. GNP or gross national product is the cost of all final goods and services in the entire market produced by the population of a country, regardless of the location of where the production process took place. GNP is founded upon ownership of a product not based upon location. Just like GDP a higher GNP usually means a higher standard of living. It is an effective way to measure a nation’s income and wealth.

GNI or gross national income combines the factor payments which are rent, wages, interest, and profit and looks at the income of a country per capita. Per capita means per person of a population. Canada’s GNI per capita as of 2009 is $37,410. GNI is also an excellent way of judging a country’s standard of living, a higher GNI usually means a higher standard of living. A downside to GNI is that doesn’t take into consideration the effects on the environment such as pollution and crime rates.

National Income is a country’s entire earnings from the factors of production within a definite amount of time; it can also be defined as the total spending of a country. Higher national incomes usually mean a higher standard of living, but this does not mean that everyone in the country experiences a high standard of living. It can increase the standard of living because when a country has more money it can be spent on things such as better healthcare and education. Canada’s average income as of 2007 was $32,220, which puts it in third place. Usually a higher national income is a contributing factor to a higher standard of living.