Which of the following can be a valid reason for Canada's GDP exceeding its GNP in 2001?
A)Net factor income from abroad in Canada was negative.
B)Canada's GNP measurements were flawed.
C)Canada's indirect business taxes were exceptionally high.
D)The World Bank underestimated Canada's net exports.
E)Canada's residents received more foreign aid than they could spend.

Question

Quizplus · Accepted Answer

When net factor income from abroad is negative, it means that the income earned by Canada's residents working abroad is less than the income earned by foreigners working in Canada. This can result in Canada's GDP (which includes income earned in the country regardless of citizenship) being higher than its GNP (which includes income earned by citizens regardless of location).

Which of the Following Can Be a Valid Reason for Canada's