Answer to Question #50389 in Macroeconomics for abdulla sabit
Distinguish between GDP and GNP. When can GNP be greater than GDP in an economy?
It is necessary to note that GNP and GDP both reflect the national output and income of an economy. The main difference is that GNP takes into account net income receipts from abroad. We can write an equation: GNP = GDP + NR (Net income inflow from assets abroad or Net Income Receipts) - NP (Net payment outflow to foreign assets). So, GNP can be higher than GDP when a country has a positive result from net foreign inflows.