Net national income
Have you ever heard of the word "income"? Well, just like when you get money for doing some chores at home, countries also have a way of measuring the money they make in a year. This is called Gross Domestic Product (GDP) and it is the total amount of money a country makes from everything it produces.
But just like you have to pay for things when you make money, countries also have to pay for things they use to make money like machines, buildings, and paying their workers. This is called expenses.
So when we take away all the expenses from the GDP, we get the Net National Income (NNI). It is the money left after paying for everything used to make money and it helps us understand how much money a country has and how well its economy is doing.
Think of it like this, if you did some chores and made $10 but you had to pay $3 for the cleaning supplies you used, then your net income would be $7. Similarly, for a country, the NNI tells us how much money it has after paying for everything it used to make its money.
But just like you have to pay for things when you make money, countries also have to pay for things they use to make money like machines, buildings, and paying their workers. This is called expenses.
So when we take away all the expenses from the GDP, we get the Net National Income (NNI). It is the money left after paying for everything used to make money and it helps us understand how much money a country has and how well its economy is doing.
Think of it like this, if you did some chores and made $10 but you had to pay $3 for the cleaning supplies you used, then your net income would be $7. Similarly, for a country, the NNI tells us how much money it has after paying for everything it used to make its money.
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