Answer to Question #238033 in Macroeconomics for betel

Question

what is the difference between GDP and GNP? which one is a better measure of economic performance of a country?

Answer 1

GDP measures the value of goods and services produced within a country's borders, by citizens and non-citizens.

GNP measures the value of goods and services produced by only a country's citizens but both domestically and abroad.

The most comprehensive measure of overall economic performance is gross domestic product or GDP,which is an accurate indicator of the size of an economy as it measures the output or total market value of goods and services produced in the domestic economy during a particular time period.