In a closed economy, gross domestic product is always equal to gross national product
True or False with Reasons
In a closed economy, gross domestic product is always equal to gross national product.
Anurag Pathak Changed status to publish December 8, 2023
True,
In a closed economy, the gross domestic product is always equal to the gross national product.
It happens because net factor income from abroad is zero due to no interaction with the rest of the world.
For Example:-
Gross Domestic Product = ₹ 300 Crores
Net Factor Income from abroad (NFIA) = ₹ 0 (due to no interaction with rest of the world)
Gross National Income = Gross Domestic Product + Net Factor Income from Abraod
Gross National Income = ₹ 300 + ₹ 0
Gross National Income = ₹ 300 Crores
Anurag Pathak Changed status to publish December 7, 2023
