GDP Equations - GDP Equations National Income and Product...

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GDP EquationsNational Income and Product Accounts:GDP = C + I + G + (X – M)GNP = GDP + NFIANNP = GNP – CCANI = NNP – SDPI = NI +Income received but not earned(dividends, government transfer payments,personal interest income)-Income earned but not received(corporate profits, social insurance contributions,net interest, indirect business taxes)DPI = PI – Personal taxes(NFIA = receipts of factor income from the rest of the world- payments of factor income to the rest of the world.)Ways of measuring GDP:1.GDP as the value of final output:GDP = Σ (Pix Qi)2.GDP as expenditures:GDP = C + I + G + (X – M)3.GDP as the sources of income:GDP = w + i + R + profit – NFIA +CCA + SD4.GDP as the uses of income:GDP = DC + S + T + M
Measuring GDP as expenditures is equivalent to measuring GDP as thesources of income:For any firm,profit = sales – costs
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