What is the GNP full form?

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GNP full form

The GNP full form is Gross National Product. GNP estimates the total value of final products and services turned out in a time period by the means of the production owned by the residents of a country. GNP is calculated by adding the personal consumption expenditure, government expenditure, private domestic investment, net exports, and income earned by citizens from international investments. Next, the income earned by foreign residents is subtracted from it. Net exports refer to the difference between imports and exports of a country. GNP is related to the GDP or the gross domestic product. GDP takes into account all outputs produced within a country regardless of who owns the means of production.  Keep reading to know more about GNP.

GNP Full Form: Importance and Limitations

GNP is important for several reasons. First of all, it is a key indicator of the economic performance of the country. GNP provides insight into the standard of living of the people in a country. It is also a useful benchmark to compare the different countries’ economic performance. Moreover, it is used to predict a country’s future economic growth.

However, GNP is not a perfect measurement of the economic activity or welfare of a country. For example, it does not take into account the income distribution in a country. Moreover, it ignores several economic activities like the production of black market services and goods,

Difference Between GNP and GDP

GNP and GDP are common measures used to determine the economy of a country. However, both are calculated in different ways. GDP is the value of all goods and services that are produced within a country. However, GNP full form is Gross National Product. It is the total value of goods and services produced within a country, and abroad.

Also Read: What is the Full Form of GDP?

How to Calculate GNP?

The full form of GNP is Gross National Product. Generally, the GDP plus net income from abroad is taken into account to calculate the GNP.  However, the official formula for calculating GNP is as follows:

Gross National Product = C + G + I + NX.

Here, C means consumption, G is Gross investment, I is the total of all government expenditures, and NX is for Net exports. Therefore, to get the GNI or gross national income subtract the indirect taxes and subsidies from the GNP.

The full form of GNP is the Gross National Product. This was all about the Full Form of GNP.  Visit our  Full Form Page to discover more intriguing articles about full forms. You can also get a consolidated list of 300+ full forms here! Get in touch with the experts at Leverage Edu in order to kickstart your study abroad journey!

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