Using the table below (mind the footnote at the bottom of the table):
a. Calculate GDP and GNP based on a method used primarily in China. Identify the method.
b. Calculate GDP and GNP based on a method used primarily in the United States. Identify the method.

Question

Quizplus · Accepted Answer

The Answer is a. Let's use the Value-Added Method.
GDP: 2.94-.14 = 2.84 = 1.4 (materials) + 1.44 (CMM implied value-added)
GNP: 2.84-.5 x (.42+.20) = 2.53=1.4 (assume materials produced all domestic stakeholders) + 1.13 (CMM value-added domestically)
b. Income Approach:
GDP = 0 Since No income generated in the United States.
GNP = .31 Gross Dividends paid to American shareholder (see calculation in (a))

Using the Table Below (Mind the Footnote at the Bottom