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Do you agree with the following statement: Gross National Product (GNP) is the sum of Gross...

Do you agree with the following statement: Gross National Product (GNP) is the sum of Gross Domestic Product (GDP) and the current account (CA)? Provide a brief explanation.

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Answer #1

Current account is the account which involves imports and exports of goods and services.

Gross domestic product is the total value of final goods and services produced in an economy during a given period of time. One of the component of GDP is difference between imports and exports of goods and services that is net exports.

Gross national product is the total value of final goods and services produced by the country's factors(land, labor, capital and entrepreneur) irrespective of their place of production.

Mainly GNP is equals to the sum of GDP and net factor income from abroad. Here net factor income from abroad is the difference between factor income from abroad and factor income to abroad.

So not agree with the given statement.

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