Which of the following statements is/are CORRECT in the context of National Income Accounting?
Show Hint
- Gross Domestic Product (GDP) is the sum of all factor payments.
- Net Domestic Product (NDP) is equal to Gross Domestic Product (GDP) minus depreciation.
- Gross National Product (GNP) is equal to Gross Domestic Product (GDP) plus net income from abroad.
- Net National Product (NNP) is equal to Gross National Product (GNP) minus Gross Domestic Product (GDP).
The Correct Option is B, C
Solution and Explanation
(A) Incorrect. GDP includes all goods and services produced domestically. Factor payments relate to the income method but are not directly equal to GDP.
(B) Correct. NDP = GDP − Depreciation.
(C) Correct. GNP = GDP + Net income from abroad.
(D) Incorrect. NNP = GNP − Depreciation, not GDP.
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