SCERT Maharashtra solutions for Economics [English] 12 Standard HSC chapter 7 - National Income [Latest edition]

Choose the correct option.

Precautions to be taken while estimating national income by output method:

1. Only value of final goods and services must be taken in to account.
2. Indirect taxes included in the market prices are to be deducted.
3. Subsidies given by the government on certain products must be added.
4. Sale and purchase of second hand goods should be considered.

Choose the correct option.

Practical difficulties in the measurement of national income:

1. Illegal income
2. Problem of double counting
3. Inadequate and unreliable data
4. Valuation of inventories

Complete the Correlation:

______ : C + I + G + (X-M) :: GNP : C + I + G + (X-M) + (R-P).

Complete the correlation:

Output method : __________ :: Income method : Factor cost method

Give economic term.

Net market value of all final goods and services produced within the territorial boundaries of a country during a period of one year –

Give an economic term:

Wear and tear of capital assets due to their use in the process of production.

Find the odd word

Concepts of national income -

Find the odd word

Practical difficulties in measuring national income -

In India, national income is estimated using ______.

Complete the following statement.

NNP is obtained by ______.

Assertion and Reasoning type question.

Assertion (A): In national income, value of only final goods and services produced in the economy are considered.

Reasoning (R): National income is always expressed in monetary terms.

Assertion and Reasoning type question.

Assertion (A): Transfer payments are included in national income.

Reasoning (R): Transfer payments such as pension, unemployment allowance etc. are a part of government expenditure.

Identify & explain the concept from the given illustration.

Sarla, a retired school teacher receives a monthly pension of ₹ 20,000/- from the Government.

Distinguish Between

Gross Domestic Product and Net Domestic Product

Explain any four features of national income.

Explain the two-sector model of the circular flow of national income.

State with reason, whether you agree or disagree with the following statement:

There are many theoretical difficulties in the measurement of national income.

State with reason whether you agree or disagree with the following statement:

Transfer payments are included in national income.

Study the following table, figure, passage and answer the question given below it.

A. Complete the formula

GNP = C + `square` + G + (X - M) + `square` (1m)

B. Calculate Gross National Product & Net National Product from the above data. (3m)

1. Explain the concept of product (real flow) with the help of above diagram. (2m) 
2. Explain the concept of Money flow with the help of above diagram. (2m)

PASSAGE

Corona has slowed down the economy Lockdown imposed to contain the spread of Corona virus had resulted in closure of manufacturing and business activities. During this financial year, the economy is expected to move towards a contractionary phase rather than expansionary phase. This has been stated in the budget. This is the first paperless budget in the history of India. At the same time, it is the third post-independence budget to be presented at a time when the economy is shrinking. The budget shows a fiscal deficit of more than 5%.

The Union Finance Minister has presented a budget that seeks to accelerate the economy by balancing the impact of Corona on the economy on one hand and growing expectations of all sectors on the other. A significant increase in the allocation for Healthcare by 137% is a feature of this budget. In this budget, the expected revenue for the year 212-2022 is Rs. 34,35, 000crore and the expected expenditure is Rs. 35,83, 000 crore.

Attempts have been made to boost infrastructure, education, agricultural production, employment generation and industry, but the Income tax status quo has remained the same. The budget provides Rs.16.5 lakh crore for agricultural credit, Rs. 223,000 crore for health facilities, Rs. 3 lakh crore for Power Distribution Scheme, Rs. 15,700 crore for Small and Medium Enterprises and Rs. 20,000 crore for Government Bank Capital.

1. What is the percentage increase in the provision for Healthcare? (1 mark) 
2. Mention the sectors that have been promoted in this budget. (1 mark) 
3. Express your personal opinion based on the above information regarding the budget ( 2 marks)

Write any four practical difficulties in national income estimation.

Explain the income method and expenditure method of measuring national income.

Answer in detail:

Explain in detail the output method of measuring national income