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GNP is a different measure (value of production by residents of a country) to GDP (value of production with the geographical bounds of a country).
GDP is the gross value (not volume) of production within an economy. Used to be called Gross National Product...
GNP is a different measure (value of production by residents of a country) to GDP (value of production with the geographical bounds of a country).
Ohhhhh I'm sorry. And here I was thinking I was in the beginners section! My apologies. Perhaps in future you can make me aware that my question may not be the best, and direct me to a good website that I can research myself, as opposed to posting useless comments and trying to make others out to be stupid. Not all of us are as educated as yourself.
Thanks for your help champ
Fair enough comment, but maybe consider that some new people will ask questions as a way of establishing themselves in a forum, and maybe to gauge how helpful people are or otherwise.As Henry Ford said - "You should chop your own wood, It will warm you twice"
Heres the thing, the questions you asked are very easy to reserach yourself, Not only thst it would be faster to research it yourself than ask the question here and have an asf type for 20mins giving you a complete answer.
As Explod showed, he simply cut and pasted from wiki, you could have easily searched for it yourself, and as you search for the info you will find many other pieces to complete your puzzel along the way.
Fair enough comment, but maybe consider that some new people will ask questions as a way of establishing themselves in a forum, and maybe to gauge how helpful people are or otherwise.
It seemed a fairly genuine question to me and I'm a bit surprised at some of the criticism.
I question that McLovin.
It is not just the value of production of residents of a country but more importantly ownership of a company domiciled within the same country where the goods are "actually" produced. That is GNP.
Disclosure: I'm a Product of Australia:
Fair enough comment, but maybe consider that some new people will ask questions as a way of establishing themselves in a forum, and maybe to gauge how helpful people are or otherwise.
It seemed a fairly genuine question to me and I'm a bit surprised at some of the criticism.
Tyson, I wasn't directing criticism at you or anyone else, and yes, you are indeed usually very helpful.
I was just trying to offer an alternative basis for Young Gun asking the question, i.e. more of a 'getting to know you' thing.
I might be totally wrong and just having a rare moment of feeling indulgent or something.
Ahh OK, that's much better.
GDP is the value of everything a country produces and the change in that number being "economic growth". As you said there are three different methods (production, income, expenditure) of measuring and they should all arrive at the same number, but because of the estimation involved they usually won't. You don't really need to know how the three arrive at a GDP number.
Essentially the ABS estimates the number by surveying thousands of large businesses, which is why it's prone to revision. They might also use things like BAS reciepts.
There's a bit here about how they do it:
http://www.abs.gov.au/Ausstats/abs@...Notes&prodno=5206.0&issue=Jun 2011&num=&view=
Julia, I always try and be helpful. I have spent hours replying to peoples questions and trying to add layers to different discussions and even sending PMS.
However, On the face face of it, to me. the original post that started this thread asked multiple questions that any one with the ability to log on and post a thread should be able to google and spend some time reading about.
Then once they have done some reading start a thread where they can offer opinions, ideas and grey areas where the need clarification. Not simply ask us to collect facts for them.
Also if someone could give me examples of good and bad gdp and maybe some current levels.
1, isnt wikipedia able to be edited and changed by anyone? which brings into question the validity of the info you get off there?
2, secondly, ive apologised for the original post, i was just firing the first things that came to my mind and clarified further down,
3, i find it frustrating ive had to spend most of this post defending myself...and in the beginners section?
Since GDP is a measure of things produced and includes services rendered, bad GDP would include things that don't add to the general well being, particularly the product and services needed to repair damage, either accidental or intentional.
So, for instance, is a kid sprays graffiti on a city wall and the council employs the services of a contractor to clean it up, then that service is part of GDP. However, it is obvious that it is wasted labour as it would not have been necessary if the vandal hadn't sprayed the wall to begin with. Another example might be the Queensland floods. The services and products used to clean up the mess adds to Australia's GDP, but if we didn't have the floods to begin with, we wouldn't have needed to expend those resources. Bad GDP is not just accidents and damage, but would include much of the costs associated with the legal system, bad workmanship needing repair (e.g fixing the pinks batts problem) - really anything that requires expenditure on a product or service that doesn't add to the well being of the nation. Good GDP would be everything else.
So am i correct in thinking that the figure they arrive at for GDP(even after being revised) could still be quite inaccurate? taking into account wrong boxes ticked, wrong buttons pushed, things missed or left out by businesses? or do things like this have minimal impact to the end figure?
finally this is probably a very simple and almost useless example:
first quarter expenditure comes in at 10 bill...second quarter expenditure comes in at 11 bill..growth is 10% on previous quarter? once again i know this isnt a good example but is this the general principal behind gdp calc?
i've always known of inflation and how it is good or bad but was just never aware of how it was determined and how it was linked to gdp so i appreciate the help guys!
Just to clarify, inflation isn't GDP growth.
....so im confused, the two arent linked? is inflation purely calculated on supply and demand, and the reserve is fighting against rising prices of general goods and services, as opposed to an increasing gdp?
does this mean that an increase in GNP that you spoke of would have an affect on inflation? and that gdp is just an indication as to whether an economy is growing or contracting, which is still an important indicator on its own?
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