Product approach: The market value of all final goods and services produced within a nation during a fixed period of time. Market value: allows comparison between different goods. Has some problems — ignores some goods. Final goods and service: Treatment of inventories; Capital goods; Avoids double counting; Value added. Expenditure approach: Total spending on final goods and services produced within a nation during a specified period of time.
Income expenditure identity and four categories of spending: Consumption C , Investment I , government purchases of goods and services G and net exports NX. This compensation may impact how and where listings appear.
Investopedia does not include all offers available in the marketplace. Gross National Product GNP Definition Gross national product GNP is an economic statistic that includes GDP, plus any income earned by a residents from overseas investments, minus income earned within the domestic economy by foreign residents.
Department of Commerce, is responsible for the analysis and reporting of economic data. Real gross domestic product real GDP is an inflation-adjusted measure of the value of all goods and services produced in an economy.
What Is Aggregate Demand? Aggregate demand is the total amount of goods and services demanded in the economy at a given overall price level at a given time. Partner Links. Related Articles. Economics GDP vs. GNP: What's the Difference? Investopedia is part of the Dotdash publishing family.
ET Secure IT. Suggest a new Definition Proposed definitions will be considered for inclusion in the Economictimes. Net interest income NII Definition: Net interest income NII is the difference between the interest income a bank earns from its lending activities and the interest it pays to depositors.
NIIs of lenders with assets and liabilities bearing variable rates are more vulnerable to change in interest rates. If the spread between rate-sensitive assets RSAs and rate-sensitive liabilities RSLs increases, a rise in interest rate can make interest income rise more than interest expenses.
In such a case, NII also goes up. On the other hand, when the spread between RSAs and RSLs falls, a rise in interest rate can make interest expenses rise more than interest income, leading to a drop in NII. According to the Reserve Bank of India's June edition of financial stability report, NII growth of scheduled commercial banks has been falling over the past couple of years.
It stood at 9. NIM Definition: Net interest margin or NIM denotes the difference between the interest income earned and the interest paid by a bank or financial institution relative to its interest-earning assets like cash.
For example, if a bank had earned an interest income of Rs 8, crore and paid Rs 6, crore on its deposits on an average loan asset of Rs 64, crore, the NIM for the year will be 0. In case the demand for savings increases relative to the demand for loans, the NIM will fall. Meanwhile, a higher NIM would increase the profitability of the lender. A negative NIM indicates that the lender has been unable to make good use of its assets, as returns produced by investments has failed to offset interest expenses.
Thus, NIM is a significant indicator of financial stability of a lender. NIM has some limitations as well. The performance metric cannot be confused with profitability, as it does not account for fees and non-interest incomes that banks generate through services related to brokerage and deposit accounts. This exchange with the rest of the world is the Net Factor Income for the total economy. In Ireland in the twenty-first century the largest part of Net Factor Income are the inflows and outflows on capital.
The outflows from Ireland are mostly net profits that are made by Foreign-Owned Corporations in Ireland which are paid to their owners abroad. Even if these companies do not pay a dividend, the National Accounts treat it as if it is paid abroad see Reinvested Earnings. If foreign institutions have lent money to the Irish Government, the interest on that national debt is also part of the outflow which leaves the country.
There are also successful Irish companies with subsidiaries abroad, and these companies receive inflows into Ireland.
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