Continuous Assesment Test BCD 416-Globalisation And Development (Essay Sample)

ST PAULS UNIVERSITY
CONTINUOUS ASSESMENT TEST
BCD 416-GLOBALISATION AND DEVELOPMENT
Student’s Name
Admn No…………………….Date……………….
CAT1
1 With suitable examples explain each of the following concepts of economic growth in measurement of a country’s economic performance.
* Gross Domestic Product (GDP)
Gross domestic product (GDP) is a financial determination of the market value of all final goods and services produced in a period either quarterly or yearly of time. Nominal GDP estimates are commonly used to determine the economic performance of a whole country or region, and to make international comparisons (Yamarone, 2017). Also, Gross domestic product (GDP) is a monetary measure of the market value of all final goods and services produced in a period. Nominal GDP estimates are commonly used to determine the economic performance of a whole country or region, and to make international comparisons. Nominal GDP per capita does not, however, reflect differences in the cost of living and the inflation rates of the countries; therefore using a basis of GDP per capita at purchasing power parity (PPP) is arguably more useful when comparing differences in living standards between different nations.
ii. Gross National Product (GNP)
Gross national product (GNP) is a broad measure of a nation's total economic activity. GNP is the value of all finished goods and services produced in a country in one year by its nationals. Gross national product (GNP) is the market value of all the goods and services produced in one year by labor and property supplied by the citizens of a country. Unlike gross domestic product (GDP), which defines production based on the geographical location of production, GNP indicates allocated production based on location of ownership. In fact it calculates income by the location of ownership and residence, and so its name is also the less ambiguous gross national income. GNP is an economic statistic that is equal to GDP plus any income earned by residents from overseas investments minus income earned within the domestic economy by overseas residents. GNP includes income earned by citizens and companies abroad, but does not include income earned by foreigners within the country (Pao & Tsai, 2011).
The formula for GNP is:
Consumption + Government Expenditures + Investments + Exports + Foreign Production by U.S. Companies – Domestic Production by Foreign Companies = Gross National Product
iii. Poverty and Income Distribution
Income inequality: Income is defined as household disposable income in a particular year. The poverty rate is the ratio of the number of people in a given age group whose income falls below the poverty line; taken as half the median household income of the total population. There is widespread concern that economic growth has not been fairly shared, and that the economic crisis has only widened the gap bet...