Advertisements
Advertisements
Question
In order to avoid double counting, value added approach is used.
Solution
APPEARS IN
RELATED QUESTIONS
National income
With the increase in income, both consumption and savings increase.
Total Cost and Total Revenue.
Explain the various methods of measuring national income.
Unpaid services are not included in national income.
Find national income and private income:
(Rs crore)
(i) Wages and salaries 1,000
(ii) Net current transfer to abroad 20
(iii) Net factor income paid to abroad 10
(iv) Profit 400
(v) National debt interest 120
(vi) Social security contributions by employers 100
(vii) Current transfers from government 60
(viii) National income accruing to government 150
(ix) Rent 200
(x) Interest 300
(xi) Royalty 50
Calculate National Income from the following data:
| S.No. | Particulars | Rs.in crores |
| (i) | Private final consumption expenditure | 900 |
| (ii) | Profit | 100 |
| (iii) | Government final consumption expenditure | 400 |
| (iv) | Net indirect taxes | 100 |
| (v) | Gross domestic capital formation | 250 |
| (vi) | Change in stock | 50 |
| (vii) | Net factor income from abroad | (-)40 |
| (viii) | Consumption of fixed capital | 20 |
| (ix) | Net imports | 30 |
Giving reason explain how should the following be treated in estimating national income:
i. Expenditure on fertilizers by a farmer.
ii. Purchase of tractor by a farmer.
Which of the following affects national income? (Choose the correct alternative)
(a) Goods and Service tax
(b) Corporation tax
(c) Subsidies
(d) None of the above
Calculate (a) National Income, and (b) Net National Disposable Income:
| (Rs In crores) | |
| (i) Compensation of employees | 2,000 |
| (ii) Rent | 400 |
| (iii) Profit | 900 |
| (iv) Dividend | 100 |
| (v) Interest | 500 |
| (vi) Mixed income of self- employed | 7,000 |
| (vii) Net factor income to abroad | 50 |
| (viii) Net export | 60 |
| (ix) Net indirect taxes | 300 |
| (x) Depreciation | 150 |
| (xi) Net current transfers to aboard | 30 |
Other things remaining unchanged, when in a country the price of foreign currency rises, national income is: (choose the correct alternative)
a. Likely to rise
b. Likely to fall
c. Likely to rise and fall both
d. Not affected
Giving reason explain how should the following be treated in the estimation of national income:
Purchase of refrigerator by a firm for own use
Giving reason explain how the following should be treated in the estimation of national income:
Payment of interest by a bank to an individual
Giving reasons explain how should the following be treated in the estimation of national income:
Purchase of machinery by a factory for own use
Calculate investment expenditure from the following data about an economy which is in equilibrium:
National income = 1500
Autonomous consumption expenditure = 300
Investment expenditure = 300
Calculate national income and gross national disposable income from the following:
| (Rs Arab) | ||
| 1 | Net current transfers to abroad | 5 |
| 2 | Government final consumption expenditure | 100 |
| 3 | Net indirect tax | 80 |
| 4 | Private final consumption expenditure | 300 |
| 5 | Consumption of fixed capital | 20 |
| 6 | Gross domestic fixed capital formation | 50 |
| 7 | Net imports | (-)10 |
| 8 | Closing stock | 25 |
| 9 | Opening stock | 25 |
| 10 | Net factor income to abroad | 10 |
How should the following be treated in estimating the national income of a country? You must give a reason for your answer.
Taking care of aged parents
Calculate 'National Income' and 'Net National Disposable Income' from the following
| (Rs in Arab) | ||
| 1 | Net change in stock | 50 |
| 2 | Government final consumption expenditure | 100 |
| 3 | Net current transfers to abroad | 30 |
| 4 | Gross domestic fixed capital formation | 200 |
| 5 | Private final consumption expenditure | 500 |
| 6 | Net imports | 40 |
| 7 | Depreciation | 70 |
| 8 | Net factor income to abroad | (-)10 |
| 9 | Net indirect tax | 120 |
| 10 | Net capital transfers to abroad | 25 |
Explain national income determination through the two alternative approaches. Use Diagram.
How should the following be treated while estimating national income? You must give the reason in support of your answer.
Addition to stocks during a year
Investment made by the government is _____________ investment.(unplanned/gross/autonomous/induced)
Give reasons or explain the following
The propensity to save depends upon the level of income.
Give reasons or Explain the following statements
Services of housewives are excluded from national income.
In an economy, S = −100 + 0.6 Y is the saving function, where S is Saving and Y is National Income. If investment expenditure is 1,100, calculate:
(1) Equilibrium level of National Income
(2) Consumption expenditure at equilibrium level of National Income.
C = 50 + 0.5 Y is the Consumption Function where C is consumption expenditure and Y is National Income and Investment expenditure is 2000 is an economy. Calculate
(i) Equilibrium level of National Income.
(ii) Consumption expenditure at equilibrium level of national income.
Write explanatory answer:
Explain the output method of measuring national income.
Define or explain the following concept.
Disposable income.
State whether the following statement is true or false.
Investment made by the government is autonomous investment.
Give reason or Explain the following statement :
Paid services are included in national income.
State whether the following statements are TRUE or FALSE:
Saving increases with increase in income.
State whether the following statements are TRUE or FALSE with reason.
National income is a flow concept.
Give reasons or explain the following statement:
The concept of national income has an important place in economic development.
Write explanatory notes.
Output method of measurement of national income.
Give reasons or explain the following statements:
The net national income is less than gross national income.
Answer in brief.
Give different definitions of National Income.
State whether the following statements are True or False with reason:
Ten years period is considered for measuring National Income.
Distinguish between Illegal income and Transfer income.
State with reason whether you agree or disagree with the following statement:
Gross National product and Gross Domestic product are same concepts.
State with reason whether you agree or disagree with the following statement:
The money value of intermediate goods is not included in the estimation of national income.
Answer in detail:
Explain the 'Final Good Approach' to avoid double counting of goods and services in the estimation of national income.
Distinguish between:
Gross national product and Gross domestic product.
Distinguish between:
Net national product and Net domestic product.
Distinguish between:
Output method of measuring national income and Income method of measuring national income.
Write short note on:
Value added approach
Write short note on:
Circular flow of national income
Write short note on:
Personal disposable income
Write short note on:
Net national product at factor cost
Define or explain the following concept:
Personal income
Give reason or explain the following statement:
Income from second hand sale of goods is excluded from national income.
Give reason or explain the following statement:
National income at factor cost includes subsidy.
Give reason or explain the following statement:
Old age pension is transfer income.
State whether the following statement is true or false.
Financial year in India is leap year.
Fill in the blank with appropriate alternatives given below
National income is __________ concept.
Fill in the blank with appropriate alternatives given below
Paper purchased by a publisher is __________.
Answer the following question.
Define the problem of double counting in the computation of national income. State any two approaches to correct the problem of double counting.
Identify and explain the following concept:
Shobha collected data regarding the money value of all final goods and services produced in the country for the financial year 2018-2019.
Study the following table, figure, passage and answer the question given below it.
| Components of GNP for the year 2018 |
In crores |
| Consumption | 200 |
| Investment | 300 |
| Govt.Expenditure | 400 |
| Net export | - 100 |
| Net receipts | - 50 |
| Depreciation | 100 |
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)
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.
- What is the percentage increase in the provision for Healthcare? (1 mark)
- Mention the sectors that have been promoted in this budget. (1 mark)
- Express your personal opinion based on the above information regarding the budget ( 2 marks)
GNP =______ + Net factor income from abroad.
GNP =______ + Net factor income from abroad.
NNP stands for______.
The value of NNP at production point is called______.
The average income of the country is______.
Define GDP deflator.
Write a short note on per capita income.
Explain briefly NNP at factor cost.
What is the solution to the problem of double counting in the estimation of national income?
Real GNP is same as ______.
GNP at MP = ____________.
NNPFC =
Which of the following items are excluded from GNP measurement?
GDP MP = Rs.1000 and subsidies = Rs.50, then GDP FC will be ______.
The market price of all final goods of a country in a year is known as:
Which one is true?
GNPMP =?
NNPMP =?
If economic subsidies are added to and Indirect taxes are substracted from the national income at market prices, then it will be equal to ______.
If for a country net factor income from abroad is negative then:
If factor cost is greater than marker price, it means that:
Identify and explain the following concept.
Shobha collected data regarding the money value of all final goods and services produced in the country for the financial year 2019-20.
Give economic term:
The volume of commodities and services turned out during a given period counted without duplication.
How should the following be treated in estimating National Income of a Country? Give valid reasons.
Expenditure on upgradation of fixed asset by a firm.
Explain the meaning of national income.
