What are the 5 measures of national income?

By Ritesh|Updated : September 1st, 2022

The 5 measures of natural income are Gross domestic product, Net National Product, Gross National Product, Personal income, and disposable income. The following five factors are used to gauge national income.

5 Types of National Income Measures

Gross Domestic Product (GDP):

  • The total monetary worth of all the goods and services produced inside a nation's boundaries over a specific period is that nation's gross domestic product or GDP.
  • Although it can also be calculated quarterly, GDP is typically calculated annually.
  • For instance, the US government publishes a GDP estimate for the entire year and each quarter.
  • GDP is frequently seen as a scorecard for a country's economic health because it comprehensively evaluates a nation's productivity.

Net National Product (NNP):

  • In a specific period, the monetary worth of the produced goods and services generated by a nation's population, domestically and abroad, is known as the net national product (NNP).
  • It is the same as the gross national product (GNP), the total value of a country's annual output, less the amount of GNP needed to sustain existing stock by purchasing new items, also known as depreciation.

Gross National Product (GNP):

  • The Gross Domestic Product, or GDP, and the Gross National Product is closely related
  • GNP measures all production activity by a country's population and domestically held firms, whereas GDP measures all production activity within a country's boundaries
  • For instance, the GNP of the United States includes US-owned companies operating abroad but not foreign-owned companies operating within US boundaries.

Personal income:

  • The total amount of money received by a country's citizens is known as personal income
  • Personal income can come from various sources, such as wages from a job, dividends, and distributions from investments, rentals from owning property, and profit-sharing from enterprises.

Disposable income:

  • The amount of money a person or household has available for spending or saving after income taxes have been deducted is called disposable income (sometimes known as disposable personal income, or DPI).


What are the 5 measures of national income?

The five measures of natural income are Net National Product, Gross domestic product, Personal income, Gross National Product, and disposable income.


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