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Part 2: Income Approach to Calculating GDP (weight 45% of the assignment

grade)

Use table 7

(Relation of Gross Domestic Product, Gross National Product, and National

Income) and table 8 (Personal Income and its Disposition).

1. Create the table that contains the following information for the last

quarter where data required for this exercise is available.

Please note that using the data for previous years and/or previous

estimates will produce grade zero for this part of the project.

Omit the intermediate lines found in Tables 7 and 8 on the web site.

Gross domestic product

Gross national product

Net national product (you should calculate it as Gross national product minus

Consumption of fixed capital)

National income

Personal income

Personal Disposable Income

Personal Savings

Present the information that you received in your project.

2. Write a report in your own words (2 pages, double-spaced), which contains the

analysis of the results you received. In this report consider, but do not be limited

to the following:

1. What is the difference between gross domestic product (GDP) and gross national

product (GNP)? What is the difference in what GDP measures compared to

GNP?

2. Based on the table, what calculations must you make to determine GNP from

GDP?

3. What is national income (NI)? What does NI measure?

4. Which was higher in this year, GNP or NI? By how much?

5. What calculations must you make to determine NI from GNP?

6. NI is composed of a number of categories. What category makes up the largest

portion of NI?

7. What calculations must you make to determine Personal Income from National

Income?

8. What calculations must you make to determine Personal Disposable Income and

Personal Savings?

9. Please analyze and discuss the significance of the data that you received

for this Data exercise.

10. Reflect on what you have learned from this exercise.

March 30, 2023

Table 7. Relation of Gross Domestic Product, Gross National Product, and National Income

[Billions of dollars]

Line		2020	2021	2022 r	Seasonally adjusted at annual rates	Line
2021	2022
Q4	Q1	Q2	Q3	Q4 r
1	Gross domestic product (GDP)	21,060.5 23,315.1 25,462.7	24,349.1 24,740.5 25,248.5 25,723.9 26,138.0	1
2	Plus: Income receipts from the rest of the world	971.3 1,087.0 1,256.2	1,120.9 1,147.1 1,231.3 1,292.1 1,354.6	2
3	Less: Income payments to the rest of the world	774.3 913.9 1,078.8	939.5 958.4 1,023.3 1,130.6 1,203.1	3
4	Equals: Gross national product	21,257.4 23,488.2 25,640.1	24,530.6 24,929.2 25,456.4 25,885.4 26,289.5	4
5	Less: Consumption of fixed capital	3,577.8 3,831.6 4,284.7	3,984.9 4,113.6 4,242.1 4,358.1 4,425.1	5
6	Less: Statistical discrepancy	-214.9 -128.9 -198.8	-124.2 -277.0 -269.3 -243.7 -5.0	6
7	Equals: National income	17,894.6 19,785.5 21,554.1	20,669.9 21,092.6 21,483.6 21,771.0 21,869.4	7
8	Compensation of employees	11,592.7 12,538.5 13,600.6	13,044.4 13,259.7 13,415.2 13,755.0 13,972.6	8
9	Wages and salaries	9,457.4 10,290.1 11,223.5	10,748.4 10,925.5 11,058.0 11,361.0 11,549.3	9
10	Supplements to wages and salaries	2,135.4 2,248.4 2,377.1	2,296.0 2,334.2 2,357.1 2,394.0 2,423.2	10
11	Proprietors' income with inventory valuation and capital consumption adjustments	1,643.1 1,753.6 1,848.3	1,789.8 1,811.4 1,835.4 1,863.5 1,882.9	11
12	Rental income of persons with capital consumption adjustment	719.8 723.8 781.9	739.6 744.9 775.9 794.9 811.8	12
13	Corporate profits with inventory valuation and capital consumption adjustments	2,260.1 2,771.1 2,952.6	2,865.9 2,869.6 3,001.3 3,000.0 2,939.5	13
14	Net interest and miscellaneous payments	665.8 644.1 542.1	621.5 630.2 608.2 515.7 414.5	14
15	Taxes on production and imports less subsidies	869.0 1,181.5 1,648.7	1,424.3 1,604.9 1,652.0 1,670.6 1,667.5	15
16	Business current transfer payments (net)	144.1 171.0 183.3	178.8 170.1 198.7 177.7 186.7	16
17	Current surplus of government enterprises	-0.1 2.1 -3.4	5.8 1.8 -3.0 -6.4 -6.1	17
18	Addenda: Gross domestic income (GDI)	21,275.4 23,444.0 25,661.5	24,473.3 25,017.5 25,517.8 25,967.6 26,143.0	18
19	Average of GDP and GDI	21,167.9 23,379.6 25,562.1	24,411.2 24,879.0 25,383.1 25,845.8 26,140.5	19
20	Statistical discrepancy as a percentage of GDP	-1.0 -0.6 -0.8	-0.5 -1.1 -1.1 -0.9 0.0	20

r Revised

Source: U.S. Bureau of Economic Analysis

- 18 -

March 30, 2023

Table 8. Personal Income and Its Disposition

[Billions of dollars]

Line		2020	2021	2022 r	Seasonally adjusted at annual rates	Line
2021	2022
Q4	Q1	Q2	Q3	Q4 r
1	Personal income 1	19,832.3 21,294.8 21,809.0	21,162.1 21,319.8 21,578.3 21,969.5 22,368.3	1
2	Compensation of employees	11,592.7 12,538.5 13,600.6	13,044.4 13,259.7 13,415.2 13,755.0 13,972.6	2
3	Wages and salaries	9,457.4 10,290.1 11,223.5	10,748.4 10,925.5 11,058.0 11,361.0 11,549.3	3
4	Supplements to wages and salaries	2,135.4 2,248.4 2,377.1	2,296.0 2,334.2 2,357.1 2,394.0 2,423.2	4
5	Proprietors' income with inventory valuation and capital consumption adjustments	1,643.1 1,753.6 1,848.3	1,789.8 1,811.4 1,835.4 1,863.5 1,882.9	5
6	Farm	45.2 51.3 91.7	43.9 74.4 95.7 95.9 100.9	6
7	Nonfarm	1,597.9 1,702.2 1,756.6	1,745.9 1,737.0 1,739.7 1,767.6 1,782.0	7
8	Rental income of persons with capital consumption adjustment	719.8 723.8 781.9	739.6 744.9 775.9 794.9 811.8	8
9	Personal income receipts on assets	3,095.4 3,202.4 3,343.9	3,258.5 3,269.9 3,323.0 3,358.8 3,424.0	9
10	Personal interest income	1,647.3 1,658.6 1,726.6	1,657.5 1,670.8 1,708.6 1,738.1 1,789.0	10
11	Personal dividend income	1,448.1 1,543.9 1,617.3	1,601.0 1,599.1 1,614.4 1,620.7 1,635.0	11
12	Personal current transfer receipts	4,231.2 4,617.3 3,910.7	3,925.7 3,868.7 3,883.2 3,892.8 3,998.2	12
13	Less: Contributions for government social insurance, domestic	1,450.0 1,540.8 1,676.5	1,595.8 1,634.7 1,654.4 1,695.6 1,721.1	13
14	Less: Personal current taxes	2,236.4 2,661.7 3,200.7	2,806.1 3,145.5 3,188.5 3,236.5 3,232.3	14
15	Equals: Disposable personal income	17,595.9 18,633.1 18,608.3	18,356.1 18,174.4 18,389.8 18,733.0 19,136.0	15
16	Less: Personal outlays	14,603.6 16,389.8 17,922.5	17,019.0 17,389.5 17,798.7 18,124.5 18,377.2	16
17	Equals: Personal saving	2,992.3 2,243.4 685.8	1,337.1 784.9 591.1 608.5 758.8	17
18	Personal saving as a percentage of disposable personal income Addenda:	17.0 12.0 3.7	7.3 4.3 3.2 3.2 4.0	18
19	Personal income excluding current transfer receipts, billions of chained (2012) dollars 2	14,036.8 14,424.3 14,570.8	14,589.6 14,507.5 14,453.7 14,610.2 14,711.6	19
20	Disposable personal income, billions of chained (2012) dollars 2	15,831.6 16,115.7 15,148.9	15,537.3 15,108.8 15,021.2 15,140.6 15,324.9	20

r Revised

1. Personal income is also equal to national income less corporate profits with inventory valuation and capital consumption adjustments, taxes on production and imports less subsidies, contributions for government social insurance, net interest and miscellaneous payments, business current transfer payments (net), and current surplus of government enterprises, plus personal income receipts on assets, and personal current transfer receipts.
2. The current-dollar measure is deflated by the implicit price deflator for personal consumption expenditures.Source: U.S. Bureau of Economic Analysis