If we deduct depreciation from GNP the measure of aggregate income that we obtain is called ______.
Show answer & explanation
Correct answer: C
Explanation
The correct answer is Option 3 i.e. Net National Product.
If we deduct depreciation from Gross National Product (GNP), the measure of aggregate income that we obtain is called Net National Product (NNP). Depreciation accounts for the loss of value of capital goods over time due to wear and tear.
NNP reflects the total income earned by residents of a country after accounting for this loss, providing a more accurate measure of the economy's productive capacity and long-term sustainability.