Abstract
This chapter discusses the strengths and weaknesses of the tools that have been developed to assist in the measurement of economic performance. The chapter presents the concept of gross national product (GNP). It is a measure of the market value of goods and services that were produced during a specific time period. GNP is a flow concept and is typically measured in terms of an annual rate. GNP is a device designed to measure the market value of production that flows through the economy's factories and shops each year. As GNP measures only current production, it cannot be arrived at merely by summing the totals on all of the nation's cash registers. Many transactions have to be excluded and only final goods are counted. A final good is a good in the hands of its ultimate user. Goods go through many stages of production. However, GNP counts only the dollar market value of all final goods and services produced during a year.
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