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Gross National Product

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Definition of Gross National Product

Gross National Product Image 1

Gross National Product

Total output of final goods and services produced by a country's citizens during a year.



Related Terms:

Gross national product (GNP)

Measures and economy's total income. It is equal to GDP plus the income
abroad accruing to domestic residents minus income generated in domestic market accruing to non-residents.


GNP

See gross national product.


Aggregate Production Function

An equation determining aggregate output as a function of aggregate inputs such as labor and capital.


Bank for International Settlements (BIS)

An international bank headquartered in Basel, Switzerland, which
serves as a forum for monetary cooperation among several European central banks, the Bank of Japan, and the
U.S. Federal Reserve System. Founded in 1930 to handle the German payment of World War I reparations, it
now monitors and collects data on international banking activity and promulgates rules concerning
international bank regulation.


by-product

an incidental output of a joint process; it is salable,
but the sales value of by-products is not substantial enough
for management to justify undertaking the joint process; it
is viewed as having a higher sales value than scrap



By-product

A product that is an ancillary part of the primary production process, having
a minor resale value in comparison to the value of the primary product being
manufactured. Any proceeds from the sale of a by-product are typically offset
against the cost of the primary product, or recorded as miscellaneous revenue.


By-product

A material created incidental to a production process, which can be
sold for value.


Gross National Product Image 2

cost of production report

a process costing document that
details all operating and cost information, shows the computation
of cost per equivalent unit, and indicates cost assignment
to goods produced during the period


Domestic International Sales Corporation (DISC)

A U.S. corporation that receives a tax incentive for
export activities.


economic production run (EPR)

an estimate of the number
of units to produce at one time that minimizes the total
costs of setting up production runs and carrying inventory


equivalent units of production (EUP)

an approximation of the number of whole units of output that could have been
produced during a period from the actual effort expended
during that period; used in process costing systems to assign
costs to production


Factor of Production

A resource used to produce a good or service. The main macroeconomic factors of production are capital and labor.


Government National Mortgage Association (Ginnie Mae)

A wholly owned U.S. government corporation
within the Department of Housing & Urban Development. Ginnie Mae guarantees the timely payment of
principal and interest on securities issued by approved servicers that are collateralized by FHA-issued, VAguaranteed,
or Farmers Home Administration (FmHA)-guaranteed mortgages.


grade (of product or service)

the addition or removal of product
or service characteristics to satisfy additional needs, especially price


Gross Domestic Product

Total output of final goods and services produced within a country during a year.


Gross domestic product (GDP)

The market value of goods and services produced over time including the
income of foreign corporations and foreign residents working in the U.S., but excluding the income of U.S.
residents and corporations overseas.


Gross National Product Image 3

Gross interest

Interest earned before taxes are deducted.


Gross margin

Revenues less the cost of goods sold.



gross margin, or gross profit

This first-line measure of profit
equals sales revenue less cost of goods sold. This is profit before operating
expenses and interest and income tax expenses are deducted. Financial
reporting standards require that gross margin be reported in
external income statements. gross margin is a key variable in management
profit reports for decision making and control. gross margin
doesn’t apply to service businesses that don’t sell products.


Gross Pay

The amount of earnings due to an employee prior to tax and other deductions.


GROSS PROFIT

The profit a company makes before expenses and taxes are taken away.


Gross profit

The difference between the price at which goods or services are sold and the cost of sales.
Income The revenue generated from the sale of goods or services.


Gross profit

The result of subtracting cost of goods sold from sales. Synonymous with gross margin.


Gross Profit

Revenue less cost of goods sold.


Gross profit margin

gross profit divided by sales, which is equal to each sales dollar left over after paying
for the cost of goods sold.


Gross Profit Margin

gross profit divided by revenue.


Gross sales

The total sales recorded prior to sales discounts and returns.


Gross spread

The fraction of the gross proceeds of an underwritten securities offering that is paid as
compensation to the underwriters of the offering.



International Bank for Reconstruction and Development - IBRD or World Bank

International Bank for Reconstruction and Development makes loans at nearly conventional terms to countries for projects of high
economic priority.


International Banking Facility (IBF)

International Banking Facility. A branch that an American bank
establishes in the United States to do Eurocurrency business.


International bonds

A collective term that refers to global bonds, Eurobonds, and foreign bonds.


International Depository Receipt (IDR)

A receipt issued by a bank as evidence of ownership of one or more
shares of the underlying stock of a foreign corporation that the bank holds in trust. The advantage of the IDR
structure is that the corporation does not have to comply with all the regulatory issuing requirements of the
foreign country where the stock is to be traded. The U.S. version of the IDR is the American Depository
Receipt (ADR).


International diversification

The attempt to reduce risk by investing in the more than one nation. By
diversifying across nations whose economic cycles are not perfectly correlated, investors can typically reduce
the variability of their returns.


International finance subsidiary

A subsidiary incorporated in the U.S., usually in Delaware, whose sole
purpose was to issue debentures overseas and invest the proceeds in foreign operations, with the interest paid
to foreign bondholders not subject to U.S. withholding tax. The elimination of the corporate withholding tax
has ended the need for this type of subsidiary.


International Fisher effect

States that the interest rate differential between two countries should be an
unbiased predictor of the future change in the spot rate.


international Fisher effect

Theory that real interest rates in all countries should be equal, with differences in nominal rates reflecting differences in expected inflation.


International fund

A mutual fund that can invest only outside the United States.


international fund

A mutual fund that can invest in securities issued anywhere outside of Canada.


International market

Related: See external market.


International Monetary Fund

An organization founded in 1944 to oversee exchange arrangements of
member countries and to lend foreign currency reserves to members with short-term balance of payment
problems.


International Monetary Fund (IMF)

Organization originally established to manage the postwar fixed exchange rate system.


International Monetary Market (IMM)

A division of the CME established in 1972 for trading financial
futures. Related: Chicago Mercantile Exchange (CME).


International Reserves

See foreign exchange reserves.


Investment product line (IPML)

The line of required returns for investment projects as a function of beta
(nondiversifiable risk).


Joint product

A product that has the highest sales value from among a group of products
that are the result of a joint production process.


Lean production

The technique of stripping all non-value-added activities from
the production process, thereby using the minimum possible amount of resources
to accomplish manufacturing goals.


London International Financial Futures Exchange (LIFFE)

A London exchange where Eurodollar futures
as well as futures-style options are traded.


London International Financial Futures Exchange (LIFFE)

London exchange where Eurodollar futures as well as futures-style options are traded.


Multinational corporation

A firm that operates in more than one country.


National Debt

The debt owed by the government as a result of earlier borrowing to finance budget deficits. That part of the debt not held by the central bank is the publically held national debt.


National Futures Association (NFA)

The futures industry self regulatory organization established in 1982.


National Income

GDP with some adjustments to remove items that do not make it into anyone's hands as income, such as indirect taxes and depreciation. Loosely speaking, it is interpreted as being equal to GDP.


National Income and Product Accounts

The national accounting system that records economic activity such as GDP and related measures.


National market

Related: internal market


National Output

GDP.


National Saving

Private saving plus public saving. That part of national income which is not spent on consumption goods or government spending.


Nationalization

A government takeover of a private company.


Net Domestic Product

GDP minus depreciation.


Net National Product

GNP minus depreciation.


Non-production overhead

A general term referring to period costs, such as selling, administration and financial expenses.


Process flow production

A production configuration in which products are continually
manufactured with minimal pauses or queuing.


process productivity

the total units produced during a period
using value-added processing time


Product

Any item intended for sale.


product complexity

an assessment about the number of components in a product


product contribution margin

the difference between selling price and variable cost of goods sold


Product cost

The cost of goods or services produced.


product cost

This is a key factor in the profit model of a business. product
cost is the same as purchase cost for a retailer or wholesaler (distributor).
A manufacturer has to accumulate three different types of production
costs to determine product cost: direct materials, direct labor, and
manufacturing overhead. The cost of products (goods) sold is deducted
from sales revenue to determine gross margin (also called gross profit),
which is the first profit line reported in an external income statement
and in an internal profit report to managers.


product cost

a cost associated with making or acquiring inventory


Product cost

The total of all costs assigned to a product, typically including direct
labor, materials (with normal spoilage included), and overhead.


Product cycle

The time it takes to bring new and/or improved products to market.


product life cycle

a model depicting the stages through
which a product class (not necessarily each product) passes


product line margin

see segment margin


Product market

A business’s investment in technology, people and materials in order to make, buy and sell products or services to customers.


product- (or process-) level cost

a cost that is caused by the development, production, or acquisition of specific products or services


Product risk

A type of mortgage-pipeline risk that occurs when a lender has an unusual loan in production or
inventory but does not have a sale commitment at a prearranged price.


Product/service mix

See sales mix.


product variety

the number of different types of products
produced (or services rendered) by a firm


Production-flow commitment

An agreement by the loan purchaser to allow the monthly loan quota to be
delivered in batches.


Production overhead

A general term referring to indirect costs.


Production payment financing

A method of nonrecourse asset-based financing in which a specified
percentage of revenue realized from the sale of the project's output is used to pay debt service.


Production yield variance

The difference between the actual and budgeted proportions
of product resulting from a production process, multiplied by the standard unit cost.


productive capacity

the number of total units that could be
produced during a period based on available equipment time
productive processing time the proportion of total time that
is value-added time; also known as manufacturing cycle
efficiency


Productivity

Output per unit of input, usually measured as output per hour of labor.


Publicly Held National Debt

See national debt.


Sales Revenue Revenue recognized from the sales of products as opposed to the provision of

services.


SIMEX (Singapore International Monetary Exchange)

A leading futures and options exchange in Singapore.


UNITS OF PRODUCTION

A depreciation method that relates a machine’s depreciation to the number of units it makes each
accounting period. The method requires that someone record the machine’s output each year.



 

 

 

 

 

 

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