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A net (sometimes written nett) value is the resultant amount after accounting for the
sum
sum
or difference of two or more variables. In
economics Economics () is a social science Social science is the Branches of science, branch of science devoted to the study of society, societies and the Social relation, relationships among individuals within those societies. The term was fo ...

economics
, it is frequently used to imply the remaining value after accounting for a specific, commonly understood deduction. In these cases it is contrasted with the term '' gross'', which refers to the pre-deduction value. For example,
net income In business Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services). Simply put, it is "any activity or enterprise entered into for profit." Having a busines ...
is the total income of a
company A company, abbreviated as co., is a legal entity In law, a legal person is any person A person (plural people or persons) is a being that has certain capacities or attributes such as reason, morality, consciousness or self-consciousness ...

company
after deducting its
expensesExpenditure is an outflow of money Image:National-Debt-Gillray.jpeg, In a 1786 James Gillray caricature, the plentiful money bags handed to King George III are contrasted with the beggar whose legs and arms were amputated, in the left corner, 174 ...
—commonly known as
profit Profit may refer to: Business and law * Profit (accounting) Profit, in accounting Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic en ...
—or the total income of an individual after deducting their
income tax An income tax is a imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called ). Income tax generally is computed as the product of a tax rate times the taxable income. Taxation rates may v ...
. Profit may be broken down further into pre-taxed or
gross profit For households and individuals, gross income is the sum of all wages A wage is the distribution from an employer Employment is the relationship between two party (law), parties, usually based on a employment contract, contract where work ...
and profit after taxes or
net profit In business Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services). Simply put, it is "any activity or enterprise entered into for profit." Having a busines ...
. Similarly, an individual's
net worth Net worth is the value of all the non-financial and financial asset In financial accountancy, financial accounting, an asset is any resource owned or controlled by a business or an economic entity. It is anything (tangible or intangible) that c ...
the difference between their
asset In financial accounting Financial accounting is the field of accounting Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic entities such a ...
s (what they own) and their
liabilities Liability may refer to: Law * Legal liability, in both civil and criminal law ** Public liability, part of the law of tort which focuses on civil wrongs ** Product liability, the area of law in which manufacturers, distributors, suppliers, re ...
(what they owe to others). Similarly,
net investment In economics Economics () is the social science that studies how people interact with value; in particular, the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods an ...
in physical
capital Capital most commonly refers to: * Capital letter Letter case (or just case) is the distinction between the letters that are in larger uppercase or capitals (or more formally ''majuscule'') and smaller lowercase (or more formally ''minusc ...
such as machinery equals gross (total) investment minus the dollar amount of replacement investment that offsets
depreciation In accountancy Accounting or Accountancy is the measurement, processing, and communication of financial and non financial information about economic entity, economic entities such as businesses and corporations. Accounting, which has been ...
of pre-existing machinery, thus giving the change in the amount of machinery available for use. Likewise,
net national product Net national product (NNP) refers to gross national product The Gross National Income (GNI), previously known as Gross National Product (GNP), is the total domestic and foreign output claimed by residents of a country, consisting of Gross Dome ...
equals
gross national product The gross national income (GNI), previously known as gross national product (GNP), is the total domestic and foreign output claimed by residents of a country, consisting of gross domestic product (GDP Gross domestic product (GDP) is a mone ...
minus depreciation.


Etymology

The word ''net'', in this sense, originally derives from the Latin ''nitere'' (to shine) and ''nitidus'' (elegant, trim), and more recently from the French ''net'' (sharp, neat, clean).New World Dictionary of the American Language, Simon and Schuster, 1980.


Grammatical usage

In this sense, it may appear, separated by a comma, ''following'' the noun it modifies, e.g., "earned two million dollars, net".


See also

*
Net metering Net metering (or net energy metering, NEM) is an electricity billing mechanism that allows consumers who generate some or all of their own electricity to use that electricity anytime, instead of when it is generated. This is particularly importan ...
, electricity policy *
Net 30 Net 10, net 15, net 30 and net 60 (often hyphenated "net-" and/or followed by "days", e.g., "net 10 days") are forms of trade credit Trade credit is the loan In finance Finance is the study of financial institutions, financial markets ...
, form of trade credit *
Net profit In business Business is the activity of making one's living or making money by producing or buying and selling products (such as goods and services). Simply put, it is "any activity or enterprise entered into for profit." Having a busin ...
, gross profit minus overhead and interest *
Net weight In science Science () is a systematic enterprise that Scientific method, builds and organizes knowledge in the form of Testability, testable explanations and predictions about the universe."... modern science is a discovery as well as ...
, weight of a product, not counting packaging * Net pay, salary after deductions *
Net operating lossUnder U.S. Federal income tax law, a net operating loss (NOL) occurs when certain tax-deductible expensesExpenditure is an outflow of money Image:National-Debt-Gillray.jpeg, In a 1786 James Gillray caricature, the plentiful money bags handed to ...
*
Present value In economics Economics () is a social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behavi ...


References

National accounts Corporate taxation Income taxes {{econ-term-stub pl:Netto