What is the difference between GNP and GNP (per capita)?

Question

please explain in very simple terms as i have asked this question before and dont understand the answers. i have been taught about it in school in geography but still dont understand!! thanks,

Answer 1

GNP is the total for everyone

GNP per capital is that total divided by the number of people to find the "per person" average.

Answer 2

GNP is the Gross National Product. It is the total of value added of all economic activities in the country plus/ minus the income paid to/ earned from foreigners. It is like total income in the form of wages, salaries, rents, interest and profits of all individuals and businesses in the country.

GNP per capita is nothng but the GNP divide by the population (total number living persons in the country excluding the foreigners).

So, if GNP is $1 trillion and the population is 1 billion, per capita GNP is $1 trillion/ 1 billion = $1,000 since 1000 billions make a trillion. GNP per capita is thus an average income that indicates the average standrd of living of the citizens in a country.

GNP/capita is a measure of average national output. There are at least two kinds of problems with this as a measure of individual incomes:

Problems of measurement. Non-monetized activities may be poorly estimated (eg the products of peasant agriculture) or excluded (eg domestic work maintaining the home).

Problems of conceptualization. GNP/capita is a simple average of output divided by number of people. So it does not say anything about the distribution of national income between rich and poor.

What we can say is that GNP/capita provides a rough estimate of average national productivity and national productivity sets bounds on average living standards.

Gross national product is a quantitative measure of a nation's total economic activity, generally assessed yearly or quarterly. The GNP equals the gross domestic product plus income earned by domestic residents through foreign investments minus the income earned by foreign investors in the domestic market. Gross domestic product, often confused with GNP, is calculated from the total value of goods and services produced in an economy over a specified period. Since World War II, GNP has been generally regarded as the most important indicator of the status of an economy. In the United States, the economy is considered to be in recession if there are two consecutive quarters of decrease in GNP. Despite the fact that GNP does not allow for inflation, overall value of production, and other factors, it is nevertheless a significant measurement of economic health.