Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: National Income Accounting

Question:

Which of the following aggregate is used for "Domestic income"?

Options:

NNPMP

GNPFC

NDPFC

All of the above

Correct Answer:

NDPFC

Explanation:

The Correct answer is Option 3: NDPFC

NNPMP - Net National Product at market prices : This aggregate represents the total market value of all final goods and services produced by residents of a country over a specified period, minus depreciation. It includes income earned domestically but also includes net income earned from abroad. NNPMP is not specifically focused on domestic income.

GNPFC - Gross National Product at factor costs : This aggregate represents the total income earned by factors of production owned by residents of a country, regardless of where they are located. It includes income earned domestically and abroad by domestic factors of production.

NDPFC - Net Domestic Product at factor costs : This aggregate represents the total market value of all final goods and services produced domestically, minus depreciation, at factor cost. It focuses specifically on income earned domestically by factors of production.

Thus, as the full form depicts NDPFC talks about the domestic income whereas, other aggregates are of National income.