The Economic Glossary
- Consumption: One of the four components used to tabulate GDP, it is the sum of all consumers’ spending on goods and services.
- GDP (Gross Domestic Product): An economy’s annual Consumption plus Government Spending plus Investment plus Net Exports.
- GNP (Gross National Product): A measurement that’s usually quite similar to GDP. GDP measures economic activity within a nation’s geographic borders, whereas GNP measures economic activity among all of a nation’s firms and citizens regardless of where they are physically located.
- Government Spending: One of the components of GDP, it is the total of all government expenses.
- Investment: One of the four components of GDP, it is the sum of spending on non-consumable capital goods or investment purchases.
- Net Exports: A component of GDP that includes domestically-produced goods purchased by foreigners, and excludes foreign goods that are purchased domestically. Net Exports can be either a positive or a negative number depending on whether a nation is exporting or importing a larger amount.