One of the main indicators that characterizes the economic activity of society is the gross national product (GNP). This is the total value of the total volume of goods and services that were produced in the country for a certain time period. Typically, this period is considered one calendar year. GNP is the main indicator of economic activity and economic activity in the country.
The term "gross" means that we mean all the total output produced during the year by the national economy.
Nominal GNP is the value of the services and goods produced in the economy for a given period of time, calculated at the prices thereof.
GNP is calculated on the basis of market value, measured in monetary terms. GNP is a macroeconomic financial indicator; only the final product is considered, namely, produced for final consumption during the year. In this case, all intermediate goods used for resale should be excluded. The calculation of GNP is carried out without taking into account all non-production transactions that do not contribute to an increase in the number of products.
There are three ways to measure GNP:
1) the end-use method, that is, considering the costs of purchasing the entire volume of manufactured products for the year;
2) the distribution method, that is, calculating the income received from production in the current year;
3) by the production method, that is, by summing up the value added produced in all sectors of the national economy.
The first method is characterized by the fact that GNP is calculated according to expenses, i.e. summarize the costs of all economic entities for investment, consumption, public procurement and net exports.
The cost of investment is the cost of machine tools, equipment, buildings, structures, inventories.
Investments can be gross, including all those that go to replace equipment that is retired from the production process and clean that go to purchase new equipment.
Consumption costs include household spending on various types of services and goods.
The distribution method is that GNP is defined as the sum of all income received by households, enterprises and government agencies.
Four components of income are taken into account: 1) wages; 2) rent; 3) interest on deposits and loans; 4) profits made by owners of sole farms and cooperatives and profits made by corporations, which are divided into dividends and profits that are used to expand production.
The sum of all income is net national income. If we add depreciation to it, then we get GNP. In other words, GNP is net national income plus depreciation.
Using the value added method, the degree of participation of industries in the production of gross product is revealed. In this case, the added value added at each production stage of the manufacture of the product. Value added includes profit, salary, interest on credit, depreciation, transportation costs, advertising costs .
In 2011, GNP of Russia in terms of per capita in dollar terms amounted to 10,400. According to this indicator, the country was in 68th place in the world.
Back in 1993, in accordance with the recommendations of the United Nations, the GNP indicator was replaced by the Gross National Income (GNI) indicator. Since then, the term “GNP” has not been used in statistical practice, but for the most part exists only in textbooks on economics. However, the national statistical organizations of some countries adhere to the old terminology.