prepare a note on GDP, GNP, NNP and Per Capita income
must be clear
Answers
Gross Domestic Product (GDP)
Gross domestic product is the value of all final goods and services produced within the boundary of a nation during one year. In India one year means from 1st April to 31st March of the next year.
GDP calculation includes income of foreigners in a Country but excludes income of those people who are living outside of that country.
Net Domestic Product (NDP)
NDP is calculated by deducting the depreciation of plant and Machinery from GDP.
NDP = Gross Domestic Product - Depreciation
Gross National Product (GNP)
GNP is the value of all final goods and services produced by the residents of a country in a financial year (i.e., 1st April to 31st March of the next year in India).
While Calculating GNP, income of foreigners in a country is excluded but income of people who are living outside of that country is included. The value of GNP is calculated on the basis of GDP.
GNP = GDP + X - M
Where,
X = income of the people of a country who are living outside of the Country
M = income of the foreigners in a country
Net National Product (NNP)
Net National Product (NNP) in an economy is the GNP after deducting the loss due to depreciation.
NNP = GNP - Depreciation
NNP at Factor Cost:
It is the value of NNP when the value of goods and services is taken at the production cost.
NNP at Market Price:
It is the value of NNP at consumer cost.
NNP at market cost = NNP at factor cost + Indirect taxes – Subsidies
Per capita income (PCI) or average income measures the average income earned per person in a given area (city, region, country, etc.) in a specified year. It is calculated by dividing the area's total income by its total population.
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