Question : Which of the following is a measure of national income that takes into account the depreciation of capital and natural resources?
Option 1: Gross Domestic Product (GDP)
Option 2: Gross National Product (GNP)
Option 3: Net Domestic Product (NDP)
Option 4: Net National Product (NNP)
Correct Answer: Net Domestic Product (NDP)
Solution : The correct answer is (c) Net Domestic Product (NDP)
Net Domestic Product (NDP) is a measure of national income that takes into account the depreciation of capital and natural resources. NDP is derived by subtracting the depreciation (also known as capital consumption) from the Gross Domestic Product (GDP). It represents the net value of goods and services produced by a country's residents after accounting for the wear and tear of capital assets and the depletion of natural resources. This adjustment provides a more accurate measure of the income available for consumption and investment within the domestic economy.
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