GNP is ...

One of the main indicators that characterizes the economic activity of society is the gross national product (GNP). This is the total cost of all the volume of goods and services that were produced in the country for a certain time period. Typically, this period is one calendar year. GNP is the main indicator of economic activity and economic activity in the country.

The term "gross" means that all the total output produced for the year by the national economy is meant.

Nominal GNP is the cost of goods and services produced in the economy for a given period of time, calculated at the prices of that.

The GNP is calculated on the basis of market value, measured in monetary terms. GNP is a macroeconomic financial indicator; Only final products are considered, namely, produced for final consumption within a year. In this case, all intermediate goods used for resale should be excluded. Calculation of GNP is made without taking into account all non-production transactions that do not contribute to an increase in the number of products.

You can measure GNP in three ways:

1) by the end use method, that is, considering the cost of purchasing the entire volume of output for the year;

2) distributive way, that is, by calculating the revenues received from production in the current year;

3) by the production method, that is, summing up the added value produced in all branches of the national economy.

The first method is characterized by the fact that the calculation of GNP is carried out by expenditure, i.e. Sum up the costs of all economic entities on investment, consumption, government procurement and net exports.

The cost of investment is the cost of machinery, equipment, buildings, facilities, logistics.

Investments can be gross, including all those that go to replace equipment that is eliminated from the production process and clean, which go to purchase new equipment.

The cost of consumption includes the costs of households for different types of services and goods.

The distribution method is that GNP is defined as the sum of all incomes received by households, enterprises and government agencies.

Four components of income are taken into account: 1) wages; 2) rent; 3) interest on deposits and loans; 4) the profit received by the owners of individual farms and cooperatives and the profits received by corporations, which is divided into dividends and the profits that go into expanding production.

The sum of all incomes is a net national income. If we add depreciation to it, we will get GNP. In other words, GNP is Net national income plus depreciation.

Using the method of added value, the degree of participation of industries in the production of gross product is revealed. In this case, the values added at each production stage of the product are added. The added value includes profit, wages, interest for credit, depreciation, transportation costs, advertising costs .

GNP of Russia in 2011 from the calculation of per capita dollar equivalent was 10,400. By this indicator, the country was on the 68th place in the world.

Back in 1993, in accordance with the recommendations of the United Nations, the GNP indicator was replaced by the Gross National Income (GNI) indicator. Since then, the term "GNP" has not been used in statistical practice, but exists for the most part only in textbooks on economics. However, national statistical organizations of some countries adhere to the old terminology.