IGCSE Development Studies: Specimen Questions with Answers 24 - 25 of 98

Passage

GNP data of South Africa is as follows:

  • South Africa GNP for was $ 0.00 B, a 100 % decline from 2019.
  • South Africa GNP for 2019 was $ 353.53 B, a 6.38 % increase from 2018.
  • South Africa GNP for 2018 was $ 332.32 B, a 7.74 % increase from 2017.
  • South Africa GNP for 2017 was $ 308.44 B, a 0.34 % increase from 2016.

Question 24 (2 of 6 Based on Passage)

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Distinguish between GNP and GDP

Explanation

Distinguish between GNP and GDP
S. No.GNPGDP
1.GNP is a national conceptGDP is a territorial concept
2.GNP is a wider conceptIt is relatively a narrower concept
3.Formula of income from abroadFormula of GDP = P (G) + P (S)
4.If we subtract net factor income from abroad from it, we get GDPIf we add NFIA to it, we get GNP
5.GNP will be greater than GDP when NFIA is positive.When NFIA is negative it GDP will be greater than GNP.

2.

External Debt

Question 25 (3 of 6 Based on Passage)

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What are the components of GNP?

Explanation

Gross national product is the oldest concept of national income. It represents money value of all final goods and services produced including of course, net factor income abroad. It includes the value of final goods only and ignores the value of the intermediate goods such as raw materials.

Components of GNP are:

  • Consumer goods: It includes consumer goods produced by the private sector.
  • Private investment (I) : It includes inventory goods, producer goods produced in the private sector and construction of residential buildings
  • Goods and services produced by the government (G) : It includes both producer goods and consumer goods produced by the government.
  • Net income from abroad (E) : It can be both positive and negative

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