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Using a suitable example, distinguish between positive externalities and negative externalities. Using a suitable example, distinguish between stock variables and flow variables.
Estimate the value of Nominal Gross Domestic Product (GDP) for a hypothetical economy. The values of Real Gross Domestic Product (GDP) and Price Index are given as Rs. 500 crores and 125 respectively. Giving valid reasons explain, which of the following will not be included in the estimation of National Income of India ? (i) Purchase of shares of Sethi Ltd. by an investor in the Bombay Stock Exchange. (ii) Salaries paid by Indian Embassy situated at Japan, to the local workers. (iii) Depreciation on capital assets charged by firms.
(i) From the following data, calculate the value of Gross National Product at Factor Cost (GNP_FC) : (ii) Distinguish between Rent and Royalty. (i) Calculate the value of 'Net Value Added at Factor Cost' (NVA_FC) using the given data : (ii) Distinguish between 'value of output' and 'value addition'.
Calculate the value of Nominal Gross Domestic Product (GDP) for a hypothetical economy. The values of Real Gross Domestic Product (GDP) and Price Index are given as Rs. 1,000 crores and 250 respectively. Giving valid reasons explain, which of the following will not be included in the estimation of National Income in India ? (i) Purchase of shares by an investor in the Bombay Stock Exchange. (ii) Salaries paid to Russians working in Indian Embassy in Russia. (iii) Imputed rent of self occupied houses.
State any two precautions to be adopted while estimating National Income by Income Method. Distinguish between 'Value of Output' and 'Value Addition'.
Discuss briefly the problem of 'Double Counting', using a suitable example. Distinguish between Real Gross Domestic Product and Nominal Gross Domestic Product, using a suitable numerical example.
Estimate the missing values (?), if the value of Gross Domestic Product at factor cost (GDP_fc) by Expenditure Method and Income Method is Rs. 370 crore :
Giving valid reasons, explain how the following would be treated while estimating National income : (a) Payment of indirect taxes by a firm. (b) Purchase of goods by foregin tourists. Using the following information, calculate and analyse the value of Gross Domestic Product (GDP) deflator :
(i) From the following data, calculate Net Value Added at Factor Cost (NVA_FC) : (ii) Why there is a need to make distinction between final and intermediate goods ? (i) Discuss briefly the concept of ‘Externalities’, with suitable example. (ii) Export are not a part of ‘Net Factor Income from abroad’. Elaborate the reason behind the given statement.
State any two precautions that are taken while estimating National Income by Expenditure Method. Distinguish between Gross Domestic Product at Market Price and Net Domestic Product at Market Price.
State any two precautions that are taken while estimating National income by value added method. Distinguish between depreciation and capital loss.
From the following data, show that the National Income will be same from both Income Method and Expenditure Method : (i) Calculate the operating surplus from the following data : (ii) State and discuss briefly the three main components of Net Factor Income from Abroad.
If the Real Gross Domestic Product is Rs. 16,000 crores and Gross Domestic Product at current prices is Rs. 20,000 crores, calculate the value of price index. Giving valid reasons, classify the following into stock and flow variables : (i) Production of wheat during the year 2020 – 21 (ii) National Income of Indian Economy during the financial year 2020 – 21
If the Gross Domestic Product at current prices is Rs. 6,600 crore and GDP deflator is 110, calculate the Real Gross Domestic Product. Giving valid reasons, classify the following into stock and flow variables : (i) Value of Inventories as on 31st March, 2021 (ii) Net Investments during the year 2020 - 21
Giving valid reasons, explain how the following would be treated while estimating domestic income ? (i) Payment made by a Japanese tourist for goods purchased in India. (ii) Broker's commission on the sale of second hand goods. "Gross Domestic Product (GDP) as an indicator of welfare loses its significance if the distribution of income turns unequal." Justify the given statement with valid reason.
Distinguish between 'Value Addition' and 'Final Value of Output'. Find the Value Added by Firm A, from the following information :
Distinguish between 'Value Addition' and 'Final Value of Output'. Find Net Value Added at Factor Cost (NVA_FC) using the given data :
(a) "In the estimation of Gross Domestic Product (GDP) using expenditure method, focus lies only on expenditure by the residents of the country." Do you agree with the given statement ? Give valid reasons for your answer. (b) "National income exceeds domestic income only when exports are greater than imports." Comment.
Distinguish between 'Value Addition' and 'Final Value of Output'. Find the Net Value Added at Factor Cost (NVA_FC) using the given data :
(a) Should purchase of wheat in the wholesale market be treated as the purchase of intermediate goods ? (b) Increase in national income always implies increase in domestic income. Elucidate.
(i) “Many goods and services which may contribute to welfare, but are not included in estimating Gross Domestic Product (GDP).” Do you agree with the given statement ? Give valid reason in support of your answer. [3] (ii) With suitable examples, distinguish between final goods and intermediate goods. [3] (i) Using a suitable numerical example, distinguish between Real Gross Domestic Product (GDP) and Nominal Gross Domestic Product (GDP). [4] (ii) State the meaning of ‘normal resident’ of a country. [2]
(i) "Many goods and services which may contribute to welfare, but are not included in estimating Gross Domestic Product (GDP)." Do you agree with the given statement ? Give valid reason in support of your answer. (ii) With suitable examples, distinguish between final goods and intermediate goods. (i) Using a suitable numerical example, distinguish between Real Gross Domestic Product (GDP) and Nominal Gross Domestic Product (GDP). (ii) State the meaning of 'normal resident' of a country.
Differentiate between 'Value of Output' and 'Value Added'. Justify the following statement : "Depreciation is a fall in the value of an asset due to expected obsolescence."
Read the following text carefully : In India, after Covid-19 period, household and private sector consumption, as measured by Private Final Consumption Expenditure (PFCE), was Rs. 39.7 trillion in nominal terms in Q1 FY23, compared with Rs. 28.4 trillion for the same period last year, and Rs. 39.2 trillion in the fourth quarter (Q4) of 2021 - 22 (FY22). As a percentage of Nominal GDP, PFCE was 61.1 per cent, compared with 55.5 per cent in Q1 FY22. However, in real terms at constant prices, PFCE grew just 9.88 per cent, compared with Q1 of 2019 - 20 - the year before the Covid-19 pandemic. "Recovery in domestic demand is reflected in the growth rates of PFCE and Gross Fixed Capital Formation (GFCF) over the corresponding quarter of the previous year," said D.K. Srivastava. GFCF came in at Rs. 19 trillion in Q1 FY23, compared with Rs. 14.4 trillion in Q1 FY22. However, it was slightly lower than Rs. 20.2 trillion in Q4 FY22. In the media briefing after the GDP numbers, Finance Secretary T.V. Somanathan said this trend was expected as GFCF in present Q1 was usually lower than the previous year's Q4. On the basis of the given text and common understanding, answer the following questions : (a) Compare and analyse the trends of change in PFCE as a percentage of GDP, both in real and nominal terms. (b) "Private Final Consumption Expenditure is an important factor determining Gross Domestic Product at Market Price." Justify the given statement.
Discuss briefly, the concept of 'Mixed Income of Self-Employed' under the Income method. Defend or refute the following statement, with valid argument : "Depreciation is fall in the value of an asset due to unexpected obsolescence".
Suppose only one Good 'X' is produced in the country. Output of Good X during year 2018 and 2019 were 100 units and 110 units respectively. The market price of the product during the two years was Rs. 50 and Rs. 55 per unit respectively. Calculate the percentage change in Real Gross Domestic Product (GDP) in year 2019 using 2018 as the base year.
Suppose only one Good 'X' is produced in the country. Output of 'Good X' during 2018 & 2019 were 100 units & 120 units respectively. The market price of the product during the two years was Rs. 50 & Rs. 60 per unit respectively. Calculate the percentage change in Real Gross Domestic Product (GDP) in year 2019, using 2018 as the base year.
(I) “While estimating Gross Domestic Product (GDP) by expenditure method, entire focus is on expenditures incurred by the residents of the country.” Do you agree with the given statement ? Give valid reason in support of your answer. (II) Calculate the value of National Income from the following data : (I) How should the following be treated in estimating National Income of a Country ? Give valid reasons. (i) Profits earned by Foreign Banks in India. (ii) Expenditure on upgradation of fixed asset by a firm. (II) Suppose in a financial year, the Gross Domestic Product (GDP) at market price of a country was Rs. 1,100 crore. Net factor income from Abroad was Rs. 100 crore, the net indirect taxes was Rs. 150 crore and National income was Rs. 850 crore. Calculate the value of depreciation, on the basis of above information.
Suppose only one Good 'X' is produced in the country. Output of Good X during 2018 & 2019 were 100 units & 110 units respectively. The market price of the product during the two years was Rs. 50 & Rs. 55 per unit respectively. Calculate the percentage change in Real Gross Domestic Product (GDP) in year 2019, using 2018 as the base year.
On the basis of the data given below for an imaginary economy, estimate the value of Net Domestic Product at Factor Cost (NDP_FC) : (i) Elaborate the concept of Externalities with the help of suitable example. (ii) Define Operating Surplus.
Read the following text carefully : Decisions taken by factors of production in the production process often may affect the stakeholders indirectly. Such impacts at times are huge but are not accounted for, while estimating national income. Economists call them as externalities and they can be positive or negative. In this regard, many economists suggest carbon pricing as an important tool to ensure ecological balance. Carbon pricing tries to control greenhouse gas emissions by either placing a fee on emitting or offering subsidies on lesser emission. Through instruments like carbon tax, green cess, eco tax, etc. economists suggest moving towards greener technology eliminating such negative externalities. On the basis of the given text and common understanding, answer the following questions : (i) Define externalities. (ii) Differentiate between positive and negative externalities. (iii) Elaborate how and why carbon pricing should be promoted.
On the basis of the given data, estimate the value of National Income : State any three precautions to be taken while estimating National Income by Expenditure Method.
State any three precautions to be taken while estimating national income by income method. On the basis of the given data, estimate the value of National Income :
Read the following statements – Assertion (A) and Reason (R). Choose one of the correct alternatives given below : Assertion (A) : Real Gross Domestic Product is a better indicator of economic growth of a nation as compared to Nominal Gross Domestic Product. Reason (R) : Real Gross Domestic Product measures the value of goods and services at current year prices. Alternatives :
Estimate the value of Net National Product at Factor Cost (NNP_FC), using the following information : "Disposition Phase of circular flow of Income involves flow of factor Income, which comprises of rent, wages, interest and profits from firms to households." Defend or refute the statement, giving valid reasons in support of your answer.
(a) State the steps pertaining to the estimation of National Income by Income Method. (b) "In the past few decades, Indian economy has been fairly benefitted by positive externalities created by rapid rise in infrastructure." Justify the given statement with valid arguments.
Read the following statements – Assertion (A) and Reason (R). Choose one of the correct alternatives given below : Assertion (A) : Real Gross Domestic Product is a better indicator of economic growth of a nation as compared to Nominal Gross Domestic Product. Reason (R) : Real Gross Domestic Product measures the value of goods and services at current year prices.
Estimate the value of Gross Domestic Product at Market Price (GDP_MP), using the following information : "Disposition Phase of circular flow of Income involves flow of factor Income, which comprises of rent, wages, interest and profits from firms to households." Defend or refute the statement, giving valid reasons in support of your answer.
(a) State the steps pertaining to the estimation of National Income by Expenditure Method. (b) "In the past few decades, Indian economy has been fairly benefitted by positive externalities created by rapid rise in infrastructure." Justify the given statement with valid arguments.
Calculate Net Value Added at Factor Cost (NVA_FC) from the following data : From the following data, estimate the value of Net Indirect Taxes (NIT) :
(a) As per The Economic Times report, dated April 11, 2023 "Electric Vehicle sales cross 10 Lakh mark in financial year 2022-23." Analyse the likely impacts of this news on Gross Domestic Product (GDP) and Welfare. (b) Discuss briefly, the circular flow of income in a two sector economy model.
Calculate the value of Net Value Added at Factor Cost (NVA_FC) : Distinguish between Net Factor Income from Abroad (NFIA) and Net Exports (X – M).
(i) Explain any two precautions to be adopted while estimating National Income by Expenditure method. (ii) "Higher Gross Domestic Product (GDP) always means higher per capita availability of goods in the economy." Defend or refute the given statement as the index of welfare of the people of that country. (i) Distinguish between Stock and flow variables, using suitable examples. (ii) Explain the components of 'Profit' as per Income Method of estimating National Income (NNP_FC).
(i) Explain any two precautions to be adopted while estimating National Income by Value-added method. (ii) "Higher Gross Domestic Product (GDP) always means higher per capita availability of goods in the economy." Defend or refute the given statement as the index of welfare of the people of that country. (i) Distinguish between Stock and flow variables, using suitable examples. (ii) Explain the components of 'Profit' as per Income Method of estimating National Income (NNP_FC).
Value Addition = _____ – Value of Intermediate Consumption. (Choose the correct option(s) to complete the stated formula.) (i) Domestic sales (ii) Sales – change in stock (iii) Value of output (iv) (Number of units produced) × (Price per unit)
State the meaning and significance of Gross Domestic Product (GDP) deflator.
(i) On the basis of the data given below, estimate the value of National Income (NNP_FC) (ii) Differentiate between Real flow and Money flow. (i) Gauhar, has recently completed her fashion designing studies and started a boutique. To produce dresses for sale, she purchased various materials, including a sewing machine, fabric, buttons and thread. These items are essential for producing the dresses. Classify the material purchased by Gauhar as Final or Intermediate goods, giving valid reasons in support of the classifications. (ii) "National Income is always equal to Domestic income in a two sector economy." Defend or refute the given statement with valid reasons.
Define Real Gross Domestic Product. How is it different from Nominal Gross Domestic Product ?
(i) On the basis of the data given below, estimate the value of Domestic Income (NDP_FC) (ii) Differentiate between factor income and transfer income. (i) "In a two sector economy, National Income is always less than Domestic Income." Defend or refute the given statement with valid reasons. (ii) Gauhar, has recently completed her fashion designing studies and started a boutique. To produce dresses for sale, she purchased various materials, including a sewing machine, fabric, buttons and thread. These items are essential for producing the dresses. Classify the material purchased by Gauhar as Final or Intermediate goods, giving valid reasons in support of the classifications.
Value Addition = ____ – Value of Intermediate Consumption. (Choose the correct option(s) to complete the stated formula.) (i) Domestic sales (ii) Sales – change in stock (iii) Value of output (iv) (Number of units produced) × (Price per unit)
Define Nominal Gross Domestic Product. How is it different from Real Gross Domestic Product ?
(i) On the basis of the data given below, estimate the value of Gross National Product at Factor Cost (GNP_FC) : (ii) Differentiate between positive externalities and negative externalities. (i) Gauhar, has recently completed her fashion designing studies and started a boutique. To produce dresses for sale, she purchased various materials, including a sewing machine, fabric, buttons and thread. These items are essential for producing the dresses. Classify the material purchased by Gauhar as Final or Intermediate goods, giving valid reasons in support of the classifications. (ii) "In a two sector economy, National income is always more than Domestic income." Defend or refute the given statement with reasons.
Explain any two precautions pertaining to the Expenditure Method of estimation of National Income in a country. On the basis of the following hypothetical data : (in Rs. crore) Calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2022 - 23 using 2020 - 21 as the base year.
(i) Suppose there are only three firms in an imaginary economy, viz. X, Y and Z. During a year, the following transactions took place in the economy : (I) Firm X sold goods worth Rs. 20,000 to Firm Y and Rs. 12,000 to Firm Z. (II) Firm Y sold goods worth Rs. 11,000 to Firm X and Rs. 35,000 to Firm Z. (III) Firm Z sold goods worth Rs. 57,000 to households for final consumption. On the basis of the given transactions, calculate the value of Gross Domestic Product at Market Price (GDP_MP) in the economy. (ii) Elaborate the likely impact of construction of two new Express Highways on the Gross Domestic Product (GDP) and Welfare in an economy. (i) On the basis of the following data, estimate the value of National Income (NNP_FC) : (ii) "All producer goods are essentially capital goods." Defend or refute the given statement, with the help of a suitable example.
Explain any two precautions pertaining to the Income Method of Estimation of National Income in a country. On the basis of the following hypothetical data : (in Rs. crore) Calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2022 – 23 using 2020 – 21 as the base year.
(i) Suppose there are only three firms in an imaginary economy, viz. X, Y and Z. During a year, the following transactions took place in the economy : (I) Firm X sold goods worth Rs. 20,000 to Firm Y and Rs. 12,000 to Firm Z. (II) Firm Y sold goods worth Rs. 11,000 to Firm X and Rs. 35,000 to Firm Z. (III) Firm Z sold goods worth Rs. 57,000 to households for final consumption. On the basis of the given transactions, calculate the value of Gross Domestic Product at Market Price (GDP_MP) in the economy. (ii) Discuss the likely impact of construction of 20 new hospitals in a country on the Gross Domestic Product (GDP) and Welfare in the economy. (i) On the basis of the following data, estimate the value of Net Domestic Product (NDP_FC) : (ii) "Disposition phase of circular flow of income involves flow of factor income from firms to households." Justify the statement giving valid reason.
Explain any two precautions pertaining to the Value Added Method of Estimation of National Income in a country. On the basis of the following hypothetical data : (in Rs. crore) Calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2022 – 23 using 2020 – 21 as the base year.
(i) On the basis of the following data, estimate the value of Net Domestic Product (NDP_FC) : (ii) “Disposition phase of circular flow of income involves flow of factor income from firms to households.” Justify the statement giving valid reason. (i) Suppose there are only three firms in an imaginary economy, viz. X, Y and Z. During a year, the following transactions took place in the economy : (I) Firm X sold goods worth Rs. 20,000 to Firm Y and Rs. 12,000 to Firm Z. (II) Firm Y sold goods worth Rs. 11,000 to Firm X and Rs. 35,000 to Firm Z. (III) Firm Z sold goods worth Rs. 57,000 to households for final consumption. On the basis of the given transactions, calculate the value of Gross Domestic Product at Market Price (GDP_MP) in the economy. (ii) Discuss the likely impact of construction of 20 new hospitals in a country on the Gross Domestic Product (GDP) and Welfare in the economy.
State the steps pertaining to the estimation of National Income, under the Income Method. On the basis of the following hypothetical data, calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2022 - 23, using 2020 - 21 as the base year. (All figures in Rs. crore)
(i) Suppose, there are only three firms in a hypothetical economy, viz. A, B and C. During a given period of time, the following transactions were undertaken by them : (I) Firm A sold goods worth Rs. 2,000 to Firm B and Rs. 1,200 to Firm C. (II) Firm B sold goods worth Rs. 1,100 to Firm A and Rs. 3,500 to Firm C. (III) Firm C sold to households for final consumption, goods worth Rs. 5,700. Estimate the value of Net Domestic Product at Market Price (NDP_MP), assuming depreciation to be Rs. 120. (ii) Explain the likely impact of construction of 2000 new schools providing high-quality education in a nation on Gross Domestic Product and Welfare in an economy. (i) "All consumption goods are durable in nature." Defend or refute the given statement with a valid argument. (ii) On the basis of the given data, estimate the value of National Income (NNP_FC) :
On the basis of the following hypothetical data, calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2022 – 23, using 2020 – 21 as the base year. (All figures in Rs. crore) State the steps pertaining to the estimation of National Income, under the Expenditure Method.
(i) Explain the likely impact of construction of 100 new super speciality hospitals in a nation on Gross Domestic Product (GDP) and welfare in the economy. (ii) Suppose, there are only three firms in a hypothetical economy, viz. A, B and C. During a given period of time, the following transactions were undertaken by them : (I) Firm A sold goods worth Rs. 2,000 to Firm B and Rs. 1,200 to Firm C. (II) Firm B sold goods worth Rs. 1,100 to Firm A and Rs. 3,500 to Firm C. (III) Firm C sold to households for final consumption, goods worth Rs. 5,700. Estimate the value of Gross Domestic Product at Factor Cost (GDP_FC), assuming the value of Net Indirect Taxes to be Rs. 240. (i) On the basis of the given data, estimate the value of Net Domestic Product at Factor Cost (NDP_FC) : (ii) "All consumption goods are durable in nature." Defend or refute the given statement with a valid argument.
State the steps pertaining to the estimation of National Income, under the Value Added Method. On the basis of the following hypothetical data, calculate the percentage change in Real Gross Domestic Product (GDP) in the year 2022 – 23, using 2020 – 21 as the base year. (All figures in Rs. crore)
(i) Explain the likely impact of construction of 20 new flyovers in a nation on Gross Domestic Product (GDP) and welfare in the economy. (ii) Suppose, there are only three firms in a hypothetical economy, viz. A, B and C. During a given period of time, the following transactions were undertaken by them : (I) Firm A sold goods worth Rs. 2,000 to Firm B and Rs. 1,200 to Firm C. (II) Firm B sold goods worth Rs. 1,100 to Firm A and Rs. 3,500 to Firm C. (III) Firm C sold to households for final consumption, goods worth Rs. 5,700. Estimate the value of Gross Domestic Product at Factor Cost (GDP_FC), assuming the value of Net Indirect Taxes to be Rs. 200. (i) "All consumption goods are durable in nature." Defend or refute the given statement with a valid argument. (ii) On the basis of the given data, estimate the value of National Income (NNP_FC) :
(i) Suppose, there are only three firms in a hypothetical economy, viz. A, B and C. During a given period of time, the following transactions were under, taken by them : (I) Firm A sold goods worth Rs. 2,000 to firm B and Rs. 1,200 to Firm C. (II) Firm B sold goods worth Rs. 1,100 to Firm A and Rs. 3,500 to Firm C. (III) Firm C sold to households for final consumption, goods worth Rs. 5,700. Estimate the value of Net Domestic Product at Market Price (NDP_MP) assuming depreciation to be Rs. 120. (ii) Explain the likely impact of construction of 2000 new schools providing high-quality education in a nation on Gross Domestic Product and welfare in an economy. (i) Distinguish between Real Gross Domestic Product (GDP) and Nominal Gross Domestic Product. (ii) As per a news dated April 11, 2023 : "Electric Vehicle sales crossed one million mark in FY 2023." Analyse its impact on Gross Domestic Product (GDP) and economic welfare.
(i) Suppose, there are only three firms in a hypothetical economy, viz. A, B and C. During a given period of time, the following transactions were under, taken by them : (I) Firm A sold goods worth Rs. 2,000 to firm B and Rs. 1,200 to Firm C. (II) Firm B sold goods worth Rs. 1,100 to Firm A and Rs. 3,500 to Firm C. (III) Firm C sold to households for final consumption, goods worth Rs. 5,700. Estimate the value of Net Domestic Product at Market Price (NDP_MP) assuming depreciation to be Rs. 120. (ii) Explain the likely impact of construction of 2000 new schools providing high-quality education in a nation on Gross Domestic Product and welfare in an economy. (i) Distinguish between Real Gross Domestic Product (GDP) and Nominal Gross Domestic Product. (ii) As per a news dated April 11, 2023 : "Electric Vehicle sales crossed one million mark in FY 2023." Analyse its impact on Gross Domestic Product (GDP) and economic welfare. Explain how, 'non-monetary transactions' in an economy act as a limitation of using GDP as an indicator of welfare.
Calculate the value of 'Sales' from the following data : State and explain any two precautions that must be taken while estimating national income by income method.
State and explain any two precautions that must be taken while estimating national income by expenditure method. Calculate the value of 'Sales' from the following data :
State and explain any two precautions that must be taken while estimating national income by production method/output method. Calculate the value of 'Sales' from the following data :
Read the following statements carefully : Statement 1 : Real National Income is always less than Nominal National Income. Statement 2 : Real National Income is the money value of all the final goods and services produced by the normal residents of an economy in an accounting year, measured at the base year prices. In the light of the given statements, choose the correct alternative from the following :
On the basis of the following data, estimate the value of National Income (NNP_FC) :
Read the following text carefully : The Gross Domestic Product (GDP) deflator, is an important indicator of inflation. It represents the ratio of the total value of goods and services produced by an economy in a specific year at current prices to the prices that were in effect during a designated base year. This ratio highlights the proportion of GDP growth that can be attributed to rising prices instead of an actual increase in production levels. The GDP price deflator indicates the difference between nominal GDP and real GDP. Nominal GDP differs from real GDP as the former doesn't include inflation, while the latter does. The GDP deflator automatically adjusts for changes in consumption habits and introduction of new products and services. This feature enables it to reflect shifts in investment and consumption trends. For the GDP deflator, the `basket' for each year consists of all goods produced domestically, weighted according to the market value of total consumption for each item. On the basis of given text and common understanding, answer the following questions : (a) State the meaning of Gross Domestic Product (GDP) deflator and its significance. (b) Elaborate how Real Gross Domestic Product is different from Nominal Gross Domestic Product.
In an economy, exclusion of ___________ may lead to under estimation of the value of Gross Domestic Product (GDP). (Choose the correct option to fill in the blank) (i) Barter Transactions (ii) Services provided by family members (iii) Illegal activities (iv) Depreciation of Assets
Meera and Shahid are two classmates, who were comparing India's economic growth over the years. Meera referred to the increase in Gross Domestic Product (GDP) at current prices prevailing in market, while Sahid insisted on considering GDP after adjusting for inflation. Their debate on which of the two measures gives a true picture of people's well-being, remained inconclusive. Considering the above mentioned situation, elaborate with valid reason, which of the two variables is considered a better indicator of welfare and why ? Two friends, Ravi and Harry were discussing whether the money received from sale of an old car should be included in India's National income. Ravi was of the view that it should be included in India's National income while Harry did not agree with him. They also had difference of opinion on the treatment of brokerage paid to the car dealer. As their Economics teacher, state the treatments with valid arguments.
For a hypothetical economy, assuming there are only two firms (X and Y) with equal values of Gross Value Added (GVA). On the basis of the following data, estimate the value of Domestic Sales of both the firms (X and Y) : Ms. Reeta D'Costa, retired from the post of Income Tax Commissioner in the year 2023. Apart from her pension, she also receives the following from various sources : - Rental income from a flat she owns. - Interest income from her fixed deposits. - Money sent by her children settled abroad. Identify and classify, her monthly incomes into 'factor income' and 'transfer income', with valid reasons.
For a hypothetical economy, assuming there are only two firms (X and Y) with equal values of Gross Value Added (GVA). On the basis of the following data, estimate the values of Domestic sales of firm X : Ms. Reeta D'Costa, retired from the post of Income Tax Commissioner in the year 2023. Apart from her pension, she also receives the following from various sources : - Rental income from a flat she owns. - Interest income from her fixed deposits. - Money sent by her children settled abroad. Identify and classify, her monthly incomes into `factor income' and `transfer income', with valid reasons.
Read the following statements carefully : Statement 1 : Brokerage earned by a dealer of second hand cars is included in the estimation of National Income. Statement 2 : Imputed value of production for self-consumption is included in National Income. In the light of the above given statements, choose the correct option from the following :
Calculate compensation of employees from the data given below :
Calculate the value of `Rent' from the following data :
On the basis of the given table, estimate the value added by the Baker. (Amount in Rs. crore) (Choose the correct option)
On the basis of the given data, estimate the value of Gross Domestic Product at Factor Cost (GDP_FC) : Explain any two precautions to be kept in mind while estimating National Income by the Income method.
On the basis of the given data, estimate the value of Net Domestic Product at Factor Cost (NDP_FC) : Explain any two precautions to be kept in mind while estimating National Income by the Expenditure method.
On the basis of the given data, estimate the value of Gross National Product at Market Price (GNP_MP) : Explain any two precautions to be kept in mind while estimating National Income by the Value Added method.
"The Ministry of Statistics and Programme Implementation (MoSPI) is underway to revise the base year of Gross Domestic Product (GDP). The base year is revised periodically to better capture the structural changes happening in the economy. The proposed new base year for the GDP is 2022 - 23." The step taken by the Government of India is for revision of ___________ Gross Domestic Product (GDP), as it is measured at ___________ prices. (Choose the correct option to fill in the blanks)
Following are the steps to measure National Income (NNP_FC) by Value Added method : (i) Calculate Domestic Income (NDP_FC) by subtracting Depreciation and Net Indirect Taxes from GDP_MP. (ii) Estimate GDP_MP by adding GVA of each firm. (iii) Estimate and add Net Factor Income from Abroad to NDP_FC to arrive at NNP_FC. (iv) Identify and classify the production units into primary, secondary and tertiary sector. The correct order of arrangement of steps would be : (Choose the correct option)
Read the following statements carefully : Statement I : Positive externalities refer to the benefits a firm/an individual provides to another for which they are paid. Statement II : In case of positive externalities, Gross Domestic Product (GDP) of an economy might lead to an overestimation of the actual welfare. In the light of the given statements, choose the correct option from the following :
Estimate the value of 'Income from Property and Entrepreneurship' on the basis of the given data :
Estimate the missing values (?), if the value of Gross Domestic Product at factor cost (GDP_fc) by Expenditure Method and Income Method is Rs. 370 crore : S. No. | Items | Amount (in Rs. crore) (i) | Compensation of Employees | 175 (ii) | Private Final Consumption Expenditure | 210 (iii) | Employers' Contribution to Social Security Schemes | 50 (iv) | Net Indirect Taxes | 20 (v) | Net Exports | (-) 20 (vi) | Government Final Consumption Expenditure | ? (vii) | Operating Surplus | ? (viii) | Gross Domestic Fixed Capital Formation | 70 (ix) | Mixed Income of Self-employed | 40 (x) | Change in Stock | 60 (xi) | Consumption of Fixed Capital | 70
Distinguish between 'Value Addition' and 'Final Value of Output'. Find the Value Added by Firm A, from the following information : S. No. | Particulars | Amount (in Rs. crore) (i) | Purchase of factor inputs by Firm A | 5 (ii) | Purchase of non-factor inputs by Firm A | 2 (iii) | Sales by Firm A to other firms in the domestic economy | 10 (iv) | Import of raw materials by firm A from rest of the world | 50 (v) | Excess of opening stock over closing stock | 3
Distinguish between 'Value Addition' and 'Final Value of Output'. Find Net Value Added at Factor Cost (NVA_FC) using the given data : S. No. | Particulars | Amount (in Rs. crore) (i) | Sale of rice in the market | 58 (ii) | Purchase of tractor and thresher | 40 (iii) | Procurement of rice by the government | 20 (iv) | Self-consumption of rice during the year | 15 (v) | Expenditure on running and maintenance of tractor and thresher | 20 (vi) | Fertiliser subsidies received from the government | 3
Distinguish between 'Value Addition' and 'Final Value of Output'. Find the Net Value Added at Factor Cost (NVA_FC) using the given data : S. No. | Particulars | Amount (in Rs. crore) (i) | Sale of rice in the market | 48 (ii) | Purchase of tractor and thresher | 30 (iii) | Procurement of rice by the government | 10 (iv) | Self-consumption of rice during the year | 5 (v) | Expenditure on running and maintenance of tractor and thresher | 10 (vi) | Fertiliser subsidies received from the government | 2
On the basis of the given data, estimate the value of National Income : State any three precautions to be taken while estimating National Income by Expenditure Method. S.No. | Items | Amount (in Rs. crore) (i) | Government Final Consumption Expenditure | 110 (ii) | Private Final Consumption Expenditure | 200 (iii) | Gross Domestic Fixed Capital Formation | 30 (iv) | Net Exports | (-) 40 (v) | Increase in Stock | 20 (vi) | Consumption of Fixed Capital | 15 (vii) | Indirect Taxes | 60 (viii) | Subsidies | 15 (ix) | Net Factor Income from Abroad | (-) 40
State any three precautions to be taken while estimating national income by income method. On the basis of the given data, estimate the value of National Income : S.No. | Items | Amount (in Rs. crore) (i) | Government Final Consumption Expenditure | 200 (ii) | Private Final Consumption Expenditure | 300 (iii) | Gross Domestic Fixed Capital Formation | 80 (iv) | Net Exports | (–) 20 (v) | Increase in Stock | 20 (vi) | Consumption of Fixed Capital | 15 (vii) | Indirect Taxes | 60 (viii) | Subsidies | 15 (ix) | Net Factor Income from Abroad | (–) 40
Calculate Net Value Added at Factor Cost (NVA_FC) from the following data : From the following data, estimate the value of Net Indirect Taxes (NIT) : S. No. | Particulars | Amount (in Rs. lakh) (i) | Fixed capital goods (expected life span – 5 years) | 15 (ii) | Domestic Sales | 200 (iii) | Change in stock | (–) 10 (iv) | Exports | 10 (v) | Single use producer goods | 120 (vi) | Net indirect taxes | 20 S. No. | Particulars | Amount (Rs. in crore) (i) | Net National Product at Market Price (NNP_MP) | 1,400 (ii) | Net Factor Income from abroad | (–) 20 (iii) | Gross National Product at Factor Cost (GNP_FC) | 1,300 (iv) | Consumption of fixed capital | 100
Calculate the value of Net Value Added at Factor Cost (NVA_FC) : Distinguish between Net Factor Income from Abroad (NFIA) and Net Exports (X – M). S. No. | Particulars | Amount (In Rs. crore) (i) | Operating Surplus | 3,740 (ii) | Increase in unsold stock | 600 (iii) | Sales | 10,625 (iv) | Purchase of raw materials | 2,625 (v) | Consumption of fixed capital | 500 (vi) | Subsidies | 400 (vii) | Indirect taxes | 1,200
Using the given information, complete the following table : (Choose the correct option) | 2014 – 2015 | 2016 – 2017 Nominal GDP | 6.5 | 9 Real GDP | ...(i)... | 7.2 GDP deflator | 100 | ...(ii)...
Calculate the value of 'Sales' from the following data : State and explain any two precautions that must be taken while estimating national income by income method. S. No. | Particulars | Amount (in Rs. lakh) (i) | Subsidies | 200 (ii) | Operating surplus | 500 (iii) | Opening stock | 100 (iv) | Closing stock | 600 (v) | Intermediate consumption | 3,000 (vi) | Consumption of fixed capital | 700 (vii) | Profits | 750 (viii) | Net Value Added at Factor Cost (NVA_FC) | 2,000
State and explain any two precautions that must be taken while estimating national income by expenditure method. Calculate the value of 'Sales' from the following data : S. No. | Particulars | Amount (in Rs. lakh) (i) | Subsidies | 300 (ii) | Operating surplus | 600 (iii) | Opening stock | 120 (iv) | Closing stock | 520 (v) | Intermediate consumption | 2,900 (vi) | Consumption of fixed capital | 600 (vii) | Profits | 700 (viii) | Net Value Added at Factor Cost (NVA_FC) | 2,200
State and explain any two precautions that must be taken while estimating national income by production method/output method. Calculate the value of 'Sales' from the following data : S. No. | Particulars | Amount (in Rs. lakh) (i) | Subsidies | 300 (ii) | Operating surplus | 600 (iii) | Opening stock | 120 (iv) | Closing stock | 520 (v) | Intermediate consumption | 2,900 (vi) | Consumption of fixed capital | 600 (vii) | Profits | 700 (viii) | Net Value Added at Factor Cost (NVA_FC) | 2,200
On the basis of the following data, estimate the value of National Income (NNP_FC) : S.No. | Items | Amount (in Rs. crore) (i) | Private Final Consumption Expenditure | 1,000 (ii) | Government Final Consumption Expenditure | 2,000 (iii) | Gross Domestic Fixed Capital Formation | 1,000 (iv) | Net Exports | 100 (v) | Net Additions to Stock | 50 (vi) | Consumption of Fixed Capital | 100 (vii) | Net Factor Income from Abroad | 20 (viii) | Net Indirect Taxes | 200
Calculate compensation of employees from the data given below : S. No. | Particulars | Amount (in Rs. crore) (i) | Interest | 45 (ii) | Profits after tax | 20 (iii) | Consumption of fixed capital | 50 (iv) | Gross Domestic Product at market price (GDP_MP) | 200 (v) | Rent | 25 (vi) | Corporate tax | 5 (vii) | Goods and Services tax | 10
Calculate the value of `Rent' from the following data : S. No. | Particulars | Amount (in Rs. crore) (i) | Interest | 45 (ii) | Profit after tax | 20 (iii) | Consumption of fixed capital | 50 (iv) | Gross Domestic Product at Market Price (GDP_MP) | 200 (v) | Compensation of Employees | 45 (vi) | Corporate tax | 5 (vii) | Goods and Services Tax (GST) | 10
On the basis of the given table, estimate the value added by the Baker. (Amount in Rs. crore) (Choose the correct option) | Farmer | Baker Total Production | 100 | 200 Intermediate Consumption | 0 | 50 Value Added | 100 | ...(i)...
On the basis of the given table, estimate the value added by the Baker. (Amount in Rs. crore) (Choose the correct option) Particulars | Farmer | Baker Total Production | 100 | 200 Intermediate Consumption | 0 | 50 Value Added | 100 | ...(i)...
On the basis of the given data, estimate the value of Gross Domestic Product at Factor Cost (GDP_FC) : Explain any two precautions to be kept in mind while estimating National Income by the Income method. S. No. | Items | Amount (in Rs. crore) (i) | Private final consumption expenditure | 800 (ii) | Government final consumption expenditure | 700 (iii) | Net imports | 200 (iv) | Gross public investment | 100 (v) | Inventory investment | 50 (vi) | Gross residential construction investment | 300 (vii) | Net indirect taxes | 70 (viii) | Gross business fixed investment | 130 (ix) | Consumption of fixed capital | 20 (x) | Interest | 150 (xi) | Net factor income paid to abroad | 100
Estimate the value of 'Income from Property and Entrepreneurship' on the basis of the given data : S. No. | Items | Amount (in Rs. crore) (i) | Wages and salaries | 1,300 (ii) | Rent | 700 (iii) | Employer's contribution to social security schemes | 300 (iv) | Royalty | 200 (v) | Corporate tax | 100 (vi) | Interest | 350 (vii) | Consumption of fixed capital | 50 (viii) | Dividends | 150 (ix) | Savings of private corporate sector | 200
Estimate the value of 'Income from Property and Entrepreneurship' on the basis of the given data : S. No. | Items | Amount (in Rs. crore) (i) | Wages and salaries in cash | 1,000 (ii) | Employer's contribution to social security schemes | 300 (iii) | Rent | 500 (iv) | Rent-free accommodation by employer | 700 (v) | Royalty | 200 (vi) | Interest | 150 (vii) | Corporate Tax | 70 (viii) | Savings of private corporate sector | 130 (ix) | Indirect Taxes | 40 (x) | Dividends | 60