Ultimate Guide to National Income: Explore the Top 8 Aggregates

Aggregates of national income play a vital role in understanding the overall economic growth. They are the factors through which the policy makers can track the success of the economy and understand it. Additionally, if you want to learn about these aggregates in detail, then you can seek support from economics assignment help experts. Further, this post will help you learn about the top 8 aggregates of national income in detail. So, without wasting a single second, explore this piece.

8 Aggregates of National Income

The top 8 aggregates of national income are GDPmp, GDPfc, NDPmp, NDPfc, GNPmp, GNPfc, NNPmp and NNPfc. Dive into the section to learn about them in detail.

Gross Domestic Product at Market Price

GDP at market prices measures all the goods and services that are produced within a country. It measures the total of these goods on market value. GDP at market price is applied to products, presenting the prices consumers actually pay. It is one of the primary sources to access the growth and health.  The formula of GDPmp is C+I+G+(X-M). In this, C is for consumption, I for investment, G for government spending, X is for exports and M for imports. Additionally, X-M is known as net exports.

Gross Domestic Product at Factor Cost

It measures all the goods and services of the country over a specific time. It excludes the effect of indirect taxes and adds on subsidies. Components of GDPfc include compensation of employees, operating surplus, mixed income and consumption of fixed capital. Additionally, it carries wages, salaries and all the benefits that are paid to workers or employees. Further, if you face issues in understanding the concepts of GDPfc, you can seek support from Instant Assignment Help experts. The formula of GDPfc is GDPmp - Net indirect taxes.

Net Domestic Product at Market Price

It measures a country's economic output based on the total value of all final services and goods produced within its borders. Additionally, depreciation represents the value of capital goods. Now you must be thinking, what is depreciation? It represents the value of capital goods. It provides a more realistic performance of the economy. The formula or NDPmp is GDPmp - Depreciation.

Net Domestic Product at Factor Cost

NDPfc is also known as domestic income. It measures the total income within the territory of the country. Additionally, the best part of NDPfc is that it doesn't include indirect taxes. These taxes are based on goods and services.  It provides a real image of the income that is generated by the company. Further, it does not carry depreciation. The formula of NDPfc is GDPfc - Depreciation.

Gross National Product at Market Price

It is the total of all the goods that are produced within the country. It includes income from abroad, which is valued at current market prices. It is entirely different from gross domestic product. It is one of the most essential indicators to calculate the total income of a nation's residents. Additionally, it provides a clear image of economic strengths and weaknesses. The formula of GNP at MP is GDPmp + Net factor income from abroad(NFIA).

Gross National Product at Factor Cost

It is a measure of all the economic activities, at home or abroad, earned by a country's residents. Additionally, it reflects the final value of goods or services based on the cost of production. The formula of GNPfc is GDPfc + NFIA. Now you must be thinking what NFIA is. It is net factor income from abroad. Also, if you want to cite sources properly for your project, then you can use the Harvard referencing generator to cite sources accurately.

Net National Product at Market Price

NNP at market price is the total of the goods and services produced by a company's businesses, both domestically and abroad. There are basically three methods of calculating NNP at MP. Method 1: From GNP at market price. NNPmp = GNPmp - Depreciation. Method 2: From GDP at MP. NNPmp = GDPmp + Net factor income from abroad - Depreciation. Method 3: From NNP at factor cost. NNPmp = NNPfc + indirect taxes - subsidies.

Net National Product at Factor Cost

NNPfc is the total income of the country. It is considered the most accurate presentation of national income. Additionally, it offers the final value of the goods and services produced within the country. There are three methods of NNPfc. Method 1: From GDP at FC. NNPfc = GNPfc - Depreciation. Method 2: From NNPmp = NNPmp - Indirect taxes + Subsidies. NNPfc = Compensation of employees + operating surplus + mixed income - Net factor income from abroad.

These are the eight vital aggregates of national income.

Conclusion

All these aggregates are very vital to calculate the national income of the country. If you need any help, you can seek guidance from economics assignment help professionals. This post has discussed the eight aggregates of national income in detail. Hopefully, now you will address all these points in your economics projects and ace them.

Also Read: Learn How to Write an Analytical Essay in 5 Simple Ways