Introduction to National Income Aggregates
Introduction to national income aggregates — basic concepts, Gross Domestic Product (GDP) definition, and the distinction between domestic and national concepts. CBSE Class 12 Macroeconomics notes.
Notes
Why We Need Aggregates
National Income is a crucial concept in macroeconomics. It is measured using various aggregates or variants, each with a specific meaning, measurement method, and use.
The eight primary aggregates of national income are:
GDP_MP
Gross Domestic Product at Market Price
GDP_FC
Gross Domestic Product at Factor Cost
NDP_MP
Net Domestic Product at Market Price
NDP_FC
Net Domestic Product at Factor Cost (Domestic Income)
GNP_MP
Gross National Product at Market Price
GNP_FC
Gross National Product at Factor Cost
NNP_MP
Net National Product at Market Price
NNP_FC
Net National Product at Factor Cost (National Income)
Three Dimensions of Classification
The eight aggregates can be understood through three independent dimensions. Each dimension cuts the eight into two groups of four. Combining all three gives you all eight.
GDP_MP
Gross Domestic Product at Market Price
GDP_FC
Gross Domestic Product at Factor Cost
NDP_MP
Net Domestic Product at Market Price
NDP_FC
Net Domestic Product at Factor Cost (Domestic Income)
GNP_MP
Gross National Product at Market Price
GNP_FC
Gross National Product at Factor Cost
NNP_MP
Net National Product at Market Price
NNP_FC
Net National Product at Factor Cost (National Income)