The difference between real GDP in a closed economy and real GNP in an open economy is:

Question

Quizplus · Accepted Answer

Real GDP in a closed economy only considers the domestic production of goods and services, whereas real GNP in an open economy includes net real asset income from abroad, which measures the income earned by domestic factors of production from investments abroad minus the income earned by foreign factors of production from investments in the domestic economy. This is because in an open economy, income earned from abroad is an important component of the total income generated in the economy.

The Difference Between Real GDP in a Closed Economy and Real