Interm Macro Hwk #1.docx - Homework Problem Set#1 1 GDP is...

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Homework Problem Set #1 1. GDP is the total output based on regional, which measures all activity in the country, not including ownership. Since GDP is regional, it will not take into account Whereas, GNP is ownership measure, focusing on the total output owned by Americans, not focusing on region. For example, the American GNP measures the production levels of any American owned entity, regardless of where the actual production process is taking place. Meanwhile, the GDP is the monetary value of all the finished goods and services within a country in a specific time period. The official reason the US switched from GNP to GDP is because GDP is emphasized by the United Nations’ System of National Accounts, which many other countries use as their framework for reporting and gathering statistics. Thus, comparing US performance with other countries’ performance is easier when the standards are the same. A more cynical reason why the US would use GDP is because when foreign capital or

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