When we talk about macroeconomics in Year 8, we need to know the difference between GDP and National Income.

What is GDP?
GDP stands for Gross Domestic Product. It tells us how much money all the goods and services made in a country are worth over a certain time, usually a year.

For example, if Sweden makes cars, furniture, and food, the total value of these products is the GDP of Sweden.

What is National Income?
National Income is a little different. It shows us the total money earned by everyone living in a country. This includes salaries, profits from businesses, rents, and some taxes minus any government support.

So, if a person in Sweden earns a salary and also makes money from their own business, that money adds to the National Income.

Key Differences:

1. Focus: GDP is about how much stuff is made in the country. National Income is about how much money people in the country earn.
2. Calculation: We figure out GDP by looking at spending or income. National Income considers what people and businesses earn.
3. Illustration: Think about a bakery in Sweden. The money it makes from selling bread goes into GDP. The wages paid to its workers go into National Income.

Knowing these ideas helps us understand how economies work!