Introduction to NNP
Net national product (NNP) is the financial value of finished goods and services provided by a country's citizens, abroad and domestically. It is the equivalent of the gross national product (GNP), the total value of a nation's yearly output, minus the amount of GNP needed to purchase new goods to maintain existing stock, otherwise known as depreciation.
Understanding NNP
NNP is often checked on a yearly basis to measure a nation's success when it comes to ensuring minimum production standards. It can be a great way keep an eye on the economy.
The NNP is measured in the currency of the nation it represents. That means that in India, the NNP is shown in rupees, and for USA, the NNP is shown in dollars. Calculation Of Net National Product (NNP)
The formula for NNP is:
NNP= MVFG + MVFS -Depreciation where MVFG = market value of finished goods MVFS = market value of finished services
Alternatively, NNP can be calculated as: NNP=Gross National Product−Depreciation
Special Considerations
Environmental Economics
NNP is important within environmental finance. It is a model that can help show the decrease in natural resources, and it can be used to see hether specific things are sustainable within a specified environment.
Foreign-Made Products
NNP looks at the value of goods and services that are also offered overseas. That means that the revenue of Indian manufacturers in USA count toward the NNP of India.
