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Which is the purest form of the income of a nation?
- a)Gross National Product
- b)Net domestic product
- c)Net National Product
- d)Gross Domestic Product
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Which is the purest form of the income of a nation?a) Gross National ...
- Net national product (NNP) is the monetary value of finished goods and services produced by a country's citizens, overseas and domestically, in a given period.
- It is the equivalent of the gross national product (GNP), the total value of a nation's annual output, minus the amount of GNP required to purchase new goods to maintain existing stock, otherwise known as depreciation.
Community Answer
Which is the purest form of the income of a nation?a) Gross National ...
Net National Product (NNP) is considered the purest form of income of a nation. It is a measure of the total economic output of a country after accounting for depreciation and indirect taxes. NNP provides a more accurate representation of a nation's income by excluding certain factors that can distort the true value of economic output.
1. Gross National Product (GNP):
- GNP is the total value of all final goods and services produced by the residents of a country, regardless of their location.
- It includes both domestic production and income earned from abroad (net income from abroad), such as profits, wages, and salaries.
- However, GNP does not account for depreciation and indirect taxes, which can artificially inflate the income figure.
2. Gross Domestic Product (GDP):
- GDP is the total value of all final goods and services produced within the borders of a country during a specific period.
- It includes both domestic production and income earned from abroad (net income from abroad).
- GDP does not account for depreciation and indirect taxes, similar to GNP.
3. Net Domestic Product (NDP):
- NDP is obtained by subtracting depreciation (the wear and tear on capital goods) from GDP.
- It represents the value of the net output after accounting for the loss in value of capital goods over time.
- However, NDP still does not account for indirect taxes.
4. Net National Product (NNP):
- NNP is derived from NDP by subtracting indirect taxes (such as sales tax, excise tax, etc.) and adding net income from abroad.
- It provides a more accurate measure of the income generated by the residents of a country.
- NNP accounts for depreciation and indirect taxes, making it the purest form of national income.
In summary, NNP is considered the purest form of income of a nation because it takes into account depreciation and indirect taxes, providing a more accurate measure of the true economic output and income generated by the residents of a country.
1. Gross National Product (GNP):
- GNP is the total value of all final goods and services produced by the residents of a country, regardless of their location.
- It includes both domestic production and income earned from abroad (net income from abroad), such as profits, wages, and salaries.
- However, GNP does not account for depreciation and indirect taxes, which can artificially inflate the income figure.
2. Gross Domestic Product (GDP):
- GDP is the total value of all final goods and services produced within the borders of a country during a specific period.
- It includes both domestic production and income earned from abroad (net income from abroad).
- GDP does not account for depreciation and indirect taxes, similar to GNP.
3. Net Domestic Product (NDP):
- NDP is obtained by subtracting depreciation (the wear and tear on capital goods) from GDP.
- It represents the value of the net output after accounting for the loss in value of capital goods over time.
- However, NDP still does not account for indirect taxes.
4. Net National Product (NNP):
- NNP is derived from NDP by subtracting indirect taxes (such as sales tax, excise tax, etc.) and adding net income from abroad.
- It provides a more accurate measure of the income generated by the residents of a country.
- NNP accounts for depreciation and indirect taxes, making it the purest form of national income.
In summary, NNP is considered the purest form of income of a nation because it takes into account depreciation and indirect taxes, providing a more accurate measure of the true economic output and income generated by the residents of a country.
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Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer?
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Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer?.
Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which is the purest form of the income of a nation?a) Gross National Productb) Net domestic productc) Net National Productd) Gross Domestic ProductCorrect answer is option 'C'. Can you explain this answer?.
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