National Income
National Income refers to the total amount of money earned within a country. The various aggregates are used for measurement. These aggregates are:-
1. Gross Domestic Product at Market Price (GDP mp)
2. Gross Domestic Product at Factor Cost (GDP fc)
3. Net Domestic Product at Market Price (NDP mp)
4. Net Domestic Product at factor Cost (NDP fc). It is also known as Domestic Product.
5. Gross National Product at Market Price(GNP mp)
6. Gross National Product at Factor Cost(GNP fc)
7. Net National Product at Market Price(NNP mp)
8. Net National Product at Factor Cost(NNP fc). It is also known as National Income.
All the concepts are described below:-
Gross Domestic Product at Market Price(GDP mp)
GDPmp is the gross market value of all final goods and services produced in a given period of time by factors of production located within the country.
Important Points:-
- Domestic in GDPmp means that all units of goods and services are produced within domestic boundaries of the country.
- Market Price in GDPmp means that it includes the amount of indirect tax paid and excludes the amount of subsidy received.
- Product in GDP mp means that only final goods and services have to be included.
Gross Domestic Product at factor Cost(GDPfc)
GDPfc is gross money value of all the final goods and services produced within a given period of time by factors of production located within the country.
Net Domestic Product at Factor Cost(NDPfc) (Domestic Income)
NDPfc is the net money value of all goods and services produced within a given period of time by factors of production located within the country.
NDPfc = GDPmp – Depreciation- Net Indirect taxes(NIT)
Net Domestic Product at Market Price(NDPmp)
NDPmp is the net market value of all final goods and services produced within a given period of time by factors of production located within the country.
NDPmp = GDPmp - Depreciation
Gross National Product at Factor Cost(GNPfc)
GNPfc is the gross money value of all goods and services produced within a given period of time by factors of production owned by a country’s citizen, regardless of where the output is produced.
GNPfc+GNPmp – Net Indirect taxes
Gross National Product at Market Price(GNPmp)
GNPmp is the gross market value of all final goods and services produced within a given period of time by factors of production owned by a country’s citizen, regardless of where the output is produced.
GNPmp = GDpmp + Net Factor Income from Abroad
Net National Product at Market Price(NNPmp)
NNPmp is the net market value of all goods and services produced within a given period of time by a factor of production owned by a country’s citizen, regardless of where the output is produced.
GDPfc = GDPmp – NIT (Net Indirect Taxes)
Net National Product at Factor Cost(NNP fc) or National Income
NNPfc is net money value of all the final goods and services produced within a given period of time by factors of production owned by a country’s citizen, regardless of where the output is produced.
NNPfc=GNP mp-Depreciation - Net Indirect Taxes
