Economic Calculation: GNP vs NNP
Gross National Product (GNP) represents the total market value of all final goods and services produced by a country's citizens, both domestically and abroad, within a given period. It includes the value of capital goods used up during production, known as depreciation.
Depreciation Deduction Explained
Depreciation is the decrease in the value of assets over time due to wear and tear or obsolescence.
To find the Net National Product (NNP), we subtract the value of depreciation from the GNP.
The formula is:
\(\text{Net National Product (NNP)} = \text{Gross National Product (GNP)} - \text{Depreciation}\)
Therefore, the deduction of depreciation from Gross National Product yields the Net National Product.
Similar Questions
- The value of the gross investment in order to accommodate regular wear and tear of capital is called:
- In India, National Income is computed by:
- Which of the following sectors contribute the most to GDP in India?
- As per estimates by NSO, India's GDP is estimated to grow by ______ in FY21.
- We should consider the value of final goods only while estimating GDP because:
- Equilibrium national income occurs where aggregate supply ________
- Which of the following is the correct full form of GDFCF?
- Gross Domestic Production is the total value of:
Which of the following economic models formed the basis of the Second Five-Year Plan?
Important Questions from National Income Accounting
Division of labour often involves
1. specialized economic activity.
2. highly distinct productive roles.
3. involving everyone in many of the same activities.
4. individuals engage in only a single activity and are dependent on others to meet their various needs.
Select the correct answer using the code given below:
Which of the following is NOT one of the methods of national income estimation?
Cash Reserve Ratio (CRR) is calculated as a percentage of each bank's _____.
What do you call a proportionate saving in costs gained by an increased level of production?
Which of the following statements is/are correct?
I. Only marketed goods and considered while estimating Gross Domestic Product (GDP).
II. The work done by a woman at her home is outside the purview of Gross Domestic Product.
III. In estimating GDP, only final goods and services are considered.
