National Income
About National Income
- National Income is usually defined as the total value of all final goods and services produced in a country in a particular period (Generally one year).
- Following are the measures of National Income-
(A) GDP (Gross Domestic Product)
(B) GNP (Gross National Product)
(C) NNP (Net National Product)
(A) GDP (Gross Domestic Product)-
- GDP is the total value of all final goods and services produced within the geographical boundary of the country during a particular period (Generally one year).
- In this, we consider all goods/ services, produced by both resident citizens and foreign nationals who reside within the boundary of that country.
(B) GNP (Gross National Product)-
- GNP is defined as the total value of the final goods and services produced by Indians in India as well as abroad during a particular period.
- GNP includes the value of goods produced by resident and non-resident citizens of a country whereas the income of foreigners who reside in India is excluded.
(C) Net National Product (NNP)-
- It is calculated by deducting depreciation from Gross National Product (GNP)
- NNP = GNP – Depreciation
Now let's see a question based on the above concept:
Q. Net National Product (NNP) of a country is _______.
- GDP minus depreciation allowances
- GDP plus net income from abroad
- GNP minus net income from abroad
- GNP minus depreciation allowances
Answer: D
All the best!!
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