The sum total of all factor incomes generated or produced during an accounting year within the domestic territory of a country is termed as domestic income or domestic product of a country. On the other hand, the sum total of all factor incomes earned by the normal residents of a country, irrespective of the fact that in which part of the world this income is generated, during an accounting year, is called National Income or national product of a country.
National Product = Domestic Product + Net Factor Income from Abroad
If Net Factor Income from Abroad (i.e. income paid to abroad is more than income received) is negative, the domestic product is more than the national product.
