1. Gross National Product (GNP) – is the total cash value of all goods and services sold on the open market over a given period, usually a year.
   1. GDP – Gross Domestic Product is almost the same, however, it differs by
      1. Subtract out Foreign Companies that make money in the US
      2. Adds US citizens making money in foreign countries
   2. Goods and Services (G and S) are calculated when a product is finally made
      1. What does "finally made" mean?
      2. Assume you want to build a car - start with the basics
      3. What do you need?
      4. Concept - "value adding" till the final product is made
   3. Value adding
      1. Car vs. its parts and labor that went into making ALL the parts - from fabric that went into a car to the final product
      2. If you counted both, the you would be counting the product x2
   4. Service
      1. Medical care, lawyer fees, waiters, anyone, that delivers a service to our economy
      2. Over the years we have transitioned from an industrial economy to a service economy
      3. What category does health care professionals fall into?
2. GNP and GDP ... A short video on GNP and GDP
   1. Expenditure approach – is the sum that estimates all monies spent on G and S by households (consumption), business (investments), government (what they buy), and what people use outside our country that have purchased US goods (exports)
   2. Income approach – Estimates earned income that includes: wages, salaries, profits, rental income, and interest income (on the plus side). On the negative is depreciation that removes money from this calculation
   3. Output or product approach – sum of all output from any person or organization that produces G and S. Cost for raw materials and depreciation is subtracted from this amount.
   4. GNP does not
      1. Accounts for inflation
      2. Does’t look at home repair done by the homemaker
      3. Not applied - housekeeping, stay at home moms, donations, etc.
      4. No assessed - black market or under-the-counter transaction
   5. Issues about GNP
      1. If you have a natural disaster, the cost to clean it up reflects as positive expenditure towards the GNP
      2. According to some statistics while GNP has increased over the last 30 years, if you apply inflation to individual salaries the net effect is a negative loss
      3. How does inflation effect you annual income? Calculate
      4. GNP does’t think green. The more you buy and spend to replace objects you already own the more GNP improves
      5. If you want know more about the GNP http://en.wikipedia.org/wiki/Gross_national_product

      

3. GDP
   1. The difference between GNP and GDP is the income from foreign sources
   2. GDP will be ~ 21,990 Billion dollars in 2020
   3. If you subtract out depreciation from GDP or GNP you generate (Net) NNP or NDP. More information on National and Domestic Products: http://www.cftech.com/BrainBank/FINANCE/GDP.html
   4. What do you think of these numbers? US import 3.1 trillion dollars and exported 2.5 trillion dollars in 2019
   
   5. A look at the GDP over time. Can you explain why it went into negative dollars?
4. Consumer Price Index (CPI)
   1. This is the average price of consumer goods and services purchased by households in the GDP
   2. It looks at a specific group of goods that hypothetically reflect your typical market price
      1. If the cost of the these specific goods go up, then an increase in inflation
      2. Likewise, if CPI prices go down then inflation drops
5. Comments on Personal Income from an economic point of view
   
   1. Gross Income - Income Taxes = Disposable Income
   2. Disposable income - necessities = discretionary (spend or save)
6. Inflation
   1. How has inflation affected us?
   2. What are the main causes of inflation?
      1. When demand goes up for product or service
      2. Cost to make the product goes up
      3. Increase in money supply
      4. Rising wages
      5. Monetary and fiscal policies
   3. Tacking the Consumer Price Index (CPI) which is composed of goods and services. This includes: food and berverages, housing, apparel, transportation, medical care, recreation, eduction, and communication.

      
      1. Inflation from 2014 to 2024. Note how most of it stayed within a 2% range. However, COVD changed all that!
7. Let's calculate - link

1. Classical Economics
   1. Is the heart of capitalism
   2. Supply and Demand
   3. Technology
   4. Investments
   5. Let business grow, with little to no governmental influence
2. Keynesian - economy must be stimulated!
   1. In times of economic down turn interest rates need to be reduced
   2. Government needs to invest in infrastructure

There is so much more to say, but for that you need to enroll in a business course or two