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Chapter25 Additional Insights - Chapter 25 Measuring the...

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Chapter 25: Measuring the Aggregate Economy NOTE: National Income Accounting (NIA) is an accounting application that Simon Kuznets and Richard Stone developed to measure economic activity in the aggregate economy. Their contribution to economics was recognized when these two economists were awarded the Nobel Prize in Economics. Interestingly, though, they did not win the award in the same year! [In some years, the award is shared by more than one person.] Kuznets received the award in 1971 and Stone received the award in 1984. NIA is important material but do NOT worry about the details. Here what you should know: Difference between Gross Domestic Product (GDP) and Gross National Product (GNP): GNP refers to the total market value of all final goods and services that is produced by the citizens of an economy within a one-year period (January 1- December 31). GDP refers to the total market value of all final goods and services that is produced within the geographic boundaries of an economy within a one-year period (January 1- December 31).
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