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Q:

Which of the following is deducted from NNP to arrive at NI?

  • 1
    Indirect tax
  • 2
    Capital consumption allowance
  • 3
    Subsidy
  • 4
    Interest
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Answer : 1. "Indirect tax"
Explanation :

The difference between Gross National Product and Depreciation is called Net National Product (NNP). NNP at factor cost is the net output evaluated at factor prices. It includes income earned by factor of production through participation in the production process, such as wages and salaries, rents, profits etc.

It is also called National Income. NNPFC = NNPmp – Indirect taxes

+ Subsidies = National Income. But now NNPMP is National Income

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