1. National Income (NI) is a measure of the total value of goods and services produced by the residents of a country, both domestically and abroad, during a specific period, typically a year.
2. It represents the income earned by the factors of production (land, labor, capital, entrepreneurship) owned by the residents.
3. The most accurate measure corresponding to this definition is the Net National Product at factor cost (NNPFC).
4. NNPFC is calculated as NNP at market price minus indirect taxes plus subsidies. It represents the sum of all factor incomes (wages, rent, interest, profit) generated within an economy.
5. Net National Product at market price (NNPMP) includes indirect taxes and excludes subsidies.
6. Net Domestic Product (NDP) measures production within the geographical boundaries, excluding net factor income from abroad.