Suppose the Gross Domestic Product (GDP) at market price of a country in a particular year was Rs. 1,200 crore. Net Factor Income from Abroad was Rs. 120 crore. The value of Net Indirect Taxes was Rs. 130 crore and the National Income was Rs. 950 crore. Calculate the value of depreciation for the economy.

Question

Accepted Answer

Given:
GDP_MP = Rs. 1,200 crore
NFIA = Rs. 120 crore
NIT = Rs. 60 crore
Depreciation = Rs. 100 crore

Calculation:
1. GNP_MP = GDP_MP + NFIA = 1200 + 120 = Rs. 1,320 crore
2. GNP_FC = GNP_MP - NIT = 1320 - 60 = Rs. 1,260 crore
3. NNP_MP = GNP_MP - Depreciation = 1320 - 100 = Rs. 1,220 crore
4. NNP_FC = GNP_FC - Depreciation = 1260 - 100 = Rs. 1,160 crore (National Income)