GNP & NNP
GNP and NNP: Formulas and Details
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GNP defined as aggregate market value of all final goods and services produced during a
year.
Measures only market value
Double counting has to be avoided
Includes the market value of final goods only
Final goods are those which ready to use and not for resale or further processing.
Intermediate goods are those goods which are purchased for further use.
Why including value of final goods and of intermediate goods?
GNP at Market Price Obtained by Adding Up:
Personal consumption expenditure
Gross domestic private investments
Net foreign investment
Government purchases
GNP= C+I+G+(X-M)+(R-P)
NNP: Net National Product/ National Income at Market Prices
Gross national product- depreciation
