WBCS.LIVE practice question

Net National Product (NNP) of an economy is calculated by subtracting 'Depreciation' from which value?

Solve this multiple-choice question and check the correct answer with its explanation below.

Answer options

  1. GDP
  2. GDP
  3. National Income
  4. Personal Income

Correct answer and explanation

Correct answer: GDP

Explanation: āœ… Correct Answer: B) GNP šŸ“š Explanation: Depreciation refers to the wear and tear of capital assets (like machinery and buildings) during the production process. When we subtract this value from the Gross National Product (GNP), we get the Net National Product (NNP). NNP provides a more accurate measure of the actual wealth generated by a nation, as it accounts for the cost of maintaining the existing capital stock.