Economic Awareness - Sectors of Indian Economy
Which of the following is NOT a component of Net National Product (NNP) at factor cost?
Which of the following is NOT a component of Net National Product (NNP) at factor cost?
medium Q4 of 15
Step-by-Step Solution
Step 1: Understand NNP at factor cost components
NNP at factor cost is GNP minus depreciation and adjusted for indirect taxes and subsidies.Step 2: Analyze options
Depreciation is subtracted to get NNP, so it is not a component of NNP itself. Net factor income from abroad and income earned by residents are included. Indirect taxes minus subsidies adjust market prices to factor cost.Final Answer:
Depreciation → Option DQuick Check:
Depreciation is not a component ✅
Quick Trick: Depreciation is deducted to get NNP, not included in it.
Common Mistakes:
- Including depreciation as part of NNP components.
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