The main features of GDP_MP are:
1. It includes only final goods and services produced in the domestic territory of a country;
2. It includes consumption of fixed capital (depreciation);
3. It is estimated at the prevailing prices.

BASIS FOR COMPARISON	NOMINAL GDP	REAL GDP
Meaning	The aggregate market value of the economic output produced in a year within the boundaries of the country is known as Nominal GDP.	Real GDP refers to the value of economic output produced in a given period, adjusted according to the changes in the general price level.
What is it?	GDP without the effect of inflation.	Inflation adjusted GDP
Expressed in	Current year prices	Base year prices or constant prices
Value	Higher	Generally, lower

(i) GDP stands for Gross Domestic Product. It represents the total market value of a country's output.
(ii)  It is the market value of all final goods and services produced within a given period of time by factors of production located within a country.

GNP = NNP + depreciation; depreciation
= gross investment - net investment (dollar 1 trillion - dollar 500 billion)
Therefore GNP = dollar 7 trillion + dollar 500 billion
= dollar 7.5 trillion.

(i) Firms,
(ii) Households,
(iii) Government,
(iv) Rest of the world and
(v) Capital sector.

(i)  The underground economy is the part of the economy in which transactions take place and income is generated that is unreported and therefore not counted in GDP.
(ii) Examples include such illegal activity as gambling, extortion and the narcotics trade and legal production done "off the books" to avoid income taxes.

(i) A housewife renders a number of useful services like preparation of meals, serving, tailoring, mending, washing, cleaning, bringing up children, etc.
(ii) She is not paid for them and her services are not directly included in national income. Such services performed by paid servants are included in national income.
(iii) They are called unpaid services.

(i) Gross Domestic Product (GDP) is the total value of output (goods and services) produced by the factors of production located within the country's boundary in a year.
(ii) The factors of production may be owned by anyone-citizens or foreigners.
GDP = GNP - Net income earned from abroad

(i) Gross National Product (GNP)
(ii) Gross Domestic Product (GDP)
(iii) Net National Product (NNP)
(iv) Net Domestic Product (NDP)

(i) Farmers keep a large portion of food and other goods produced on the farm for self consumption.
(ii) This amount varies from person to person.
(iii) The problem is whether this unsold portion should be included in NI or not.

GDP deflator is an index of price changes of goods and services included in GDP.
\(\text{GDP deflator}=\frac { Nominal\ GDP }{ Real\ GDP } \times 100\)

It is the total income received by the individuals of a country before payment of direct tax.
Personal Income = National Income
- (Social Security Contribution and undistributed corporate profits)
+ Transfer payments

(i) NNP is obtained deducting the value of depreciation from GNP.
(ii) NNP = GNP - depreciation allowance.

(i) NDP = GDP - Depreciation.
(ii) NNP = GNP - Depreciation.
(iii) The difference between NDP and NNP is the net factor income from abroad.
(iv) In NDP it is excluded but in NNP it is included.

\(\mathrm{GNP}=\mathrm{C}+\mathrm{I}+\mathrm{G}+(\mathrm{X}-\mathrm{M})+(\mathrm{R}-\mathrm{P})\) or \(\mathrm{GNP}_{\mathrm{MP}}=\mathrm{GDP}_{\mathrm{MP}}\) + Net Factor income from Abroad.

"The labour and capital of a country acting on its natural resources produce annually a certain net aggregate of commodities, material and immaterial including services of all kinds. This is the true net annual income or revenue of the country or national dividend". - Alfred Marshall