Part 2: Income Approach to Calculating GDP (weight 45% of the assignment
grade)
Complete the following exercise:
Go to http://www.bea.gov/
Visit the Bureau of Economic Analysis website at www.bea.gov. From the drop
down menu under “Data”, click on “by Economics Account”. Then click on
“National”, “Gross Domestic Product, and “Full Release and Tables”. Use table 7
(Relation of Gross Domestic Product, Gross National Product, and National
Income) and table 8 (Personal Income and its Disposition).
- Create the table that contains the following information for the
most recent quarter where data required for this exercise is
available.
Please note that using the data for previous years and/or previous
estimates will produce grade zero for this part of the project.
Omit the intermediate lines found in Tables 7 and 8 on the web site.
∙ Gross domestic product
∙ Gross national product
∙ Net national product (you should calculate it as Gross national product minus
Consumption of fixed capital)
∙ National income
∙ Personal income
∙ Personal Disposable Income
∙ Personal Savings
Present the information that you received in your project. - Write a report in your own words (2 pages, double-spaced), which contains the
analysis of the results you received. In this report consider, but do not be limited
to the following: - What is the difference between gross domestic product (GDP) and gross national
product (GNP)? What is the difference in what GDP measures compared to
GNP? - Based on the table, what calculations must you make to determine GNP from
GDP? - What is national income (NI)? What does NI measure?
- Which was higher in this year, GNP or NI? By how much?
- What calculations must you make to determine NI from GNP?
- NI is composed of a number of categories. What category makes up the largest
portion of NI? - What calculations must you make to determine Personal Income from National
Income? - What calculations must you make to determine Personal Disposable Income and
Personal Savings? - Please analyze and discuss the significance of the data that you received
for this Data exercise. - Reflect on what you have learned from this exercise.
