Which of the following is correct for Net National product?

Correct option is C

The correct answer is: (c) NNP = GNP – Depreciation

Explanation:
• Net National Product (NNP) is derived by subtracting depreciation (wear and tear of capital goods) from Gross National Product (GNP).
• It measures the total value of goods and services produced by a nation’s residents after accounting for capital consumption.
• NNP indicates the actual income earned by a country’s residents.

Information Booster:
• Formula: NNP = GNP – Depreciation.
• NNP at market price = NNP at factor cost + (Indirect taxes – Subsidies).
• Depreciation represents the decline in value of fixed assets due to use and time.
• GNP includes income earned by nationals from abroad.
• NNP at factor cost is also known as National Income.

Additional Knowledge:
• Gross Domestic Product (GDP): Measures total output produced within a country’s borders.
• Gross National Product (GNP): GDP + Net income from abroad.
• Net Domestic Product (NDP): GDP – Depreciation.
• Personal Income (PI): Income actually received by individuals after excluding corporate taxes and retained earnings.