Consider the following about the Gross National Product: 1) GNP i
1) GNP is the market value of the Final products that are produced by residents of a country both inside and outside the country’s territory.
2) During the calculation of GNP, the imports are not taken into consideration.
3) In the case of India, GNP is lesser than GDP.
Which of the above statements is/are correct?
A. 1 only
B. 1 and 3 only
C. 2 only
D. 2 and 3 only
Please scroll down to see the correct answer and solution guide.
Right Answer is: B
SOLUTION
Gross National Product is defined as the total market value of all final goods and services produced in a given time period (can be yearly, quarterly or any time period) by the means of production owned by residents (individual as well as entity).
For India, Net payment outflow to foreign assets is more than Net income inflow from foreign assets. Hence, GNP is lesser than GDP.
