1.

Define GNP at factor cost. How is it different from national income?

Answer»

GNPFC is the sum total of factor income earned by normal residents of a country, inclusive of depreciation during an accounting year.

GNPFC = NNPFC + Depreciation Whereas, National Income (NNPFC) is the sum total of factor income earned by normal residents of a country during an accounting year.

NNP FC = NDP FC + Net factor income from abroad GNP FC includes depreciation but NNPFC (National Income) does not include depreciation.



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