ECONOMY TERMS: PART 1

TERMS PART 1: National Income & GDP

• GDP – Value of goods and services made inside a country in a year.
  Example: Cars, clothes, and food made in India in 2024.
• GNP – GDP plus income from Indians abroad, minus income to foreigners.
  Example: Salary of an Indian working in the US is added.
• NNP – GNP minus depreciation (wear and tear).
  Example: GNP – cost of replacing old machines.
• Per Capita Income – Average income per person.
  Example: Total income ÷ population.
• Nominal GDP – GDP at current prices.
  Example: Price of goods as they are today.
• Real GDP – GDP adjusted for inflation.
  Example: Comparing actual production without price rise effect.