WAEC Economics 2020 Objective — Question 33
Question 33 of 50 from the West African Examinations Council (WAEC) Economics 2020 Objective paper, with the correct answer and a full explanation.
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How is NNP at factor cost derived from GNP at market prices?
- A. GNP - Depreciation + Indirect taxes + Subsidies
- B. GNP - Depreciation - Indirect taxes + SubsidiesCorrect
- C. GNP + Depreciation - Indirect taxes + Subsidies
- D. GNP + Depreciation - Indirect taxes - subsidies
Explanation
NNP at factor cost = GNP at market prices - Depreciation - Indirect taxes + Subsidies (removing depreciation to get NNP, then adjusting from market prices to factor cost).
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