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Consider the following statements:
1. When we divide Net Domestic Product by the total population of a nation we get the per capita income of that nation.
2. Higher the rates of depreciation lower the per capita income of the nation.
Which of these statements is/are correct?
  • a)
    1 Only
  • b)
    2 Only
  • c)
    Both 1 and 2
  • d)
    Neither of the above
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements: 1. When we divide Net Domestic Pro...
  • When we divide NNP (Net National Product) by the total population of a nation we get the 'per capita income' (PCI) of that nation, i.e., ‘income per head per year'.
  • A very basic point should be noted here that this is the point where the rates of depreciation followed by different nations make a difference.
  • Higher the rates of depreciation lower the PCI of the nation (whatever be the reason for it logical or artificial as in the case of depreciation being used as a tool of policy making).
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Consider the following statements: 1. When we divide Net Domestic Product by the total population of a nation we get the per capita income of that nation.2. Higher the rates of depreciation lower the per capita income of the nation.Which of these statements is/are correct?a) 1 Onlyb) 2 Onlyc) Both 1 and 2d) Neither of the aboveCorrect answer is option 'B'. Can you explain this answer?
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