Which term is defined as 'How much a country earns'?

Which term is defined as 'How much a country earns'?

• A. GNP
• B. GDP
• C. BR
• D. DR

Answer: (A)

This question tests understanding of national income measures and what they capture about earnings. GNP measures the total income earned by a country's residents, wherever that income is earned. It includes earnings residents receive from overseas and excludes income earned by foreigners working within the country. In other words, it reflects how much the country’s people earn in total, not just what is produced inside its borders. GDP, by contrast, tallies the value of all goods and services produced within the country’s borders, regardless of who owns the productive resources, so it describes domestic production rather than overall national earnings. The remaining terms refer to population metrics (birth rate and death rate), not earnings, so they don’t fit. Therefore, the term that fits the description is GNP.

This question tests understanding of national income measures and what they capture about earnings. GNP measures the total income earned by a country's residents, wherever that income is earned. It includes earnings residents receive from overseas and excludes income earned by foreigners working within the country. In other words, it reflects how much the country’s people earn in total, not just what is produced inside its borders. GDP, by contrast, tallies the value of all goods and services produced within the country’s borders, regardless of who owns the productive resources, so it describes domestic production rather than overall national earnings. The remaining terms refer to population metrics (birth rate and death rate), not earnings, so they don’t fit. Therefore, the term that fits the description is GNP.