Dec 06

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Easily Confused Economic Terms – Net or Gross?

Do YOU know the difference?

There are plenty of economic terms you may come across while reading the news or discussing economic issues with your friends. However, a great number of these terms are often misused or simply not understood by the general public.

If you want to be one of those who can use these terms properly, the only thing you need to do is to follow our series on Easily Confused Economic Terms



refer to two completely different sets of amounts. Generally speaking, GROSS refers to the whole of something (before anything is deducted) while NET refers to a part of the whole (the amount left over after all the deductions are made).

In the context of business accounting:

GROSS INCOME refers to all revenue that a company earns (including cash, checks, credit charges, rents, interest  and dividends)

NET INCOME refers to gross income minus business expenses.

In the context of salary:

GROSS SALARY refers to the amount agreed between you and your employer (before any deductions are made).

NET SALARY is your  take-home pay, i.e. the amount you actually take home after tax is deducted.

In the context of weight:

GROSS WEIGHT refers to the weight of the product + packaging

NET WEIGHT refers to the weight of the product (without packaging)


And now, take this quick  Quiz to practice what you have learned!

Gross vs. Net

GROSS or NET? What’s the difference?

 Image courtesy of Sujin Jetkasettakorn at FreeDigitalPhotos.net

If you like this quiz, share it with friends and colleagues by using the button below. Thanks!






Permanent link to this article: http://www.euenglish.hu/2015/12/easily-confused-economic-terms-net-or-gross/

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