Question

Consider a French-owned cheese factory located in Paris, France. Are the goods made by the cheese factory part of the U.S. Gross Domestic Product (GDP)? Are these goods included in the U.S. Gross National Product (GNP)? In 1 or 2 sentences, explain your response.

Answer 1

The correct answer is, considering a French-owned cheese factory located in Paris, France, the goods made by the Cheese Factory are not part of the U.S. Gross Domestic Product(GDP) and these goods are not included in the U.S. National Growth Product(NGP).

The U.S. Gross Domestic Product(GDP) considers the services and products that are produced in the United States territory. The GDP represents the value of the market in any period of time. It is the monetary value of what is produced in the country.

The U.S. National Growth Product(NGP) is the value of the market considering all the products and services of U.S. companies everywhere, not only in the United States. In these cases, neither one of them is owned by an American citizen. The factory is in France and it is French-owned.