Define GNP and GDP

question 79

Essay

Define GNP and GDP. Explain the difference between GNP and GDP. Why is the difference between GNP and GDP small for most countries?

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Definitions:

Elasticity

A measure in economics that shows how the quantity demanded or supplied of a good changes in response to a change in price.

Inferior Good

A type of good for which demand decreases as the income of consumers increases, as opposed to normal goods, where demand increases with income.

Normal Good

A good for which demand increases as the income of consumers increases.

Price Elasticity

measures how much the quantity demanded of a good responds to a change in the price of that good.