Gdp ( Gross Domestic Product ) Is The Statistic Of National Income

1211 Words Apr 26th, 2016 null Page
GDP (gross domestic product) is the statistic of national income. The Great Depression and World War II rose the idea of GDP. It started when a group of professionals were called into a congressional hearing to answer basic questions about the economy. The Professionals were supposed to be able to answer the questions, as they were experts on the situation. Unfortunately they couldn’t answer any of the questions, which led the department to hand the task to a young economist named Simon Kuznets. Simon came up with the concept of the GDP and eventually someone else would come along and create the GNP. The GNP (Gross National Product) was put in place to be the main source for the nation’s economic policy. Simon told them that they shouldn’t use the GNP as their main indicator because it wasn’t accurate. Now GNP and GDP are different, GNP is the market value of all the products and services that are produced in one year by labor and property supplied by the citizens of a country. GDP defines production based on the geographical location of the production, GNP decides production based on location of ownership. England was the first to feel as of the needed to measure GDP. They needed to measure GDP because they needed to figure out the taxable volume of the nation. During World War II the government needed to assess the effects of moving from peacetime consumer spending to the federal spending on war. In the earlier times GDP was only used during wars and depressions which…

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