GROSS NATIONAL PRODUCT (GNP) LESS THE PROVISION FOR THE WEAR AND TEAR OF ASSETS IS THE

• A. net factor income
• B. net indirect taxes
• C. net national product ✓
• D. net present value

The answer to the question is: C. net national product

Net national product (NNP) is a macroeconomic measure of the market value of all goods and services produced by a country’s citizens and businesses, minus depreciation. It represents the net output of a country’s economy after accounting for the wear and tear on its capital assets. NNP is calculated by subtracting depreciation from the gross national product (GNP). GNP is the total value of all final goods and services produced within a country’s borders in a particular time period, plus net factor income from abroad. Net factor income from abroad is the difference between the income earned by residents of a country from their investments in foreign countries and the income earned by foreigners from their investments in the country.

NNP is an important measure of a country’s economic performance because it provides a more accurate picture of the nation’s economic output by accounting for the depreciation of capital assets. By subtracting depreciation from GNP, NNP reflects the amount of new wealth created within a country during a specific period.

In summary, NNP is calculated as follows: NNP = GNP – Depreciation

This measure helps economists and policymakers understand the true economic growth and productivity of a country, as it takes into account the capital investment needed to maintain existing levels of production.