Question

Distinguish between domestic product (income) and national product (income).

Answer 1

	Domestic Product (Income)	National Product (Income)
1.	It is the money value of all final goods and services produced by all enterprises located within the domestic territory of a country during a year.	It is the money value of all final goods and services produced by the normal residents of a country, whether within the domestic territory or abroad, during a year.
2.	Includes income earned by both residents and non-residents (like foreign companies) within the country.	Includes income earned only by normal residents, both from within the country and from abroad.
3.	Based on the location of production within the country, regardless of the producer’s nationality.	Based on the residency of the producer, regardless of the location of production.
4.	Incomes generated by foreign firms operating in the country are included.	Incomes earned by citizens working abroad are included.
5.	Domestic Product + Net Factor Income from Abroad = National Product	National Product − Net Factor Income from Abroad = Domestic Product