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8K views73 pagesSolved and Unsolved Practicals National Income
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Smriti SaxenaCopyright
© © All Rights Reserved
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/ 73
nN
Introductory Magn
Se
4.10 SOLVED PRACTICALS
Important Formulae at
Value Added Method ‘Sector + Gross value addeq| )
Primary: by: |
fo eee cr ae ‘added by Tortary Sectr ~ Doprettet
fndkod! Tax + Net Factor Income from Abroat hy
Value of Output ~ Intermediate Consumption
ia
|
|
| Value Added = .
Value of Output = Sales + Change in Stoc! ‘
| Change In Stock = Closing Stock - Opening Stock |
| Income Method Hebe |
| National Income = NOP, +Net Factor Income from |
| NDP: = Compensation of Employees + Rent and Royal + Ino « pay
| 7 + Mixed Income \
on |
| NDP,, = Compensation of Employees + Operating Surplus + Mixed Income
Compensation of Em; jloyees = Wages and Salaries in Cash + Wages and Salaries in kind + Employer
| es Contribution to Social Security Schemes |
j Operating Surplus = Rent + Royalty + Interest + Profit
| Expenditure Method
National Income = | GDPy»~Depreciation—NetindirectTax + Net Factor Income from Abo
GDP ip = Private Final Consumption Expenditure + Government Final Consump
Expenditure + Gross Domestic Capital Formation + Net Exports |
| Gross Domestic Capital Formation = Gross Fixed Capital Formation + Change in Stock
oR
|
Gross Domestic Capital Formation = Net Domestic Capital Formation + Depreciation
|
Net Exports = Exports - Imports |
Practicals on Value Added icthod
Example 1. Calculate the value added by firm A and firm B,
Particulars Zin crores
(i) Domestic Sales by firm A 4,000
(il) Exports by firm A 4,000
(iii) Purchase by firm A oan
(iv) Sales by firm B 2,940
(v)_ Purchase by firm B 1 "300
Solution: ;
Value added by firm A
= Domestic Sales by firm A + Ex
(000 + 1000 ph ‘ports by firm A — Purchase by firm A
= & 4,800 crores
Ans. % 4,800 crores
Note: ‘Exports by fim A’ willbe included as domestic.
Sales, if
Value added by firm B °8 2'0 speciically mentioned,
= Sales by firm B ~ Purchase by firm B a
ooswomentotNatonalinggme
940 = 1,300
, = © 1,640 crores
Ans. © 1,640 crores
Example 2. From the information given below, calculate:
Value added by firm A and firm B;
+ Gross Domestic Product at market price;
«+ Net Domestic Product at factor cost.
[ Particulars Zin crores
{Sales by firm B to general government 100
|G. Sates by fmm A 500
(ii) Sales by firm B to households 350
(wv). Change in stock of firm A 20
(v)_ Closing stock of firm 8 40
(vi) Opening stock of firm B 30
(wil) Purchases by firm A 320
(vii) Indirect Taxes paid by both the firms 75
(&) Consumption of fixed capital 120
(x) Sales by firm AtoB 200
Solution:
Value added by firm A
Sales by firm A + Change in stock of firm A - Purchases by firm A.
500 + 20-320
=%200 crores
Ans, %200 crores
Note: Total sales of firm A are given. So, sales by firm A to firm B of 7200 crores are not taken separately in value
of output of firm A. However, it will be taken in Intermediate consumption of firm B.
Value added by firm B
= Sales by firm B to general government + Sales by firm B to households + (Closing
stock of firm B - Opening stock of firm B) - Purchases by firm B from firm A
= 100 +350 + (40 - 30) - 200
= 7260 crores
Ans, % 260 crores
Gross Domestic Product at market price
= Value added by firm A + Value added by firm B
= 200 + 260 = % 460 crores
Ans. % 460 crores
Net Domestic Product at factor cost
= Gross Domestic product at market price - Consumption of fixed capital — Indirect Taxes paid by both the firms
= 460-120
= £265 crores |
Ans. & 265 crores
Example 3. From the following data about a firm ‘X’ for the year 2000-01, calculate
value added at market price during that year: (CBSE, Dey
Particulars Zincroee)
Sales 90
Closing stock 25
i) Opening stock 16
Indirect taxes 10
Depreciation 20
Intermediate consumption 40
Purchase of raw materials 15
Rent 5.
Solution:
Net Value Added at Market Price
= Sales + (Closing stock - Opening stock) - Intermediate consumption - Depreciation
= 90 + (25-15) - 40 - 20 = % 40 crores
Ans. % 40 crores
‘Note: ‘Purchase of raw materials’ is not included separately as itis already included in Intermediate Consumptin,
Example 4. From the following data about firm ’X’ calculate gross value added at factor cot
(CBSE, Delhi 2003)
by it:
[Particulars Zin thousands
() Sales 500
(i) Opening stock 30
(ii) Closing stock 20
(iv) Purchase of intermediate products 300
(¥) Purchase of machinery a
(v))_Subsidy ‘40
Solution:
Gross Value Added at Factor Cost
= Sales + (Closing stock - Opening stock) ~ Purchase of intermediate products +
Subsidy
500 + (20 - 30) - 300 + 40
230 thousands
Ans. % 230 thousands
Note:"Purchase of machinery’ is not considered as it is not a part of intermediate. consumption. Depreciation
(ii) Domestic Sales
(iii) Change in Stock
(iv) Exports
‘Single Use Producer Goods
Net Indirect Taxes
Solution:
Gross “es Added at Market Price ar Goods
= Domestic Sales + Change in Stock + Exports ~Single Use Produc
= 200+ (-)10 + 10-120
= %80 lakhs
Ans. % 80 lakhs pasion oe
Example 6. From the following data relating to a firm, calculate is ist ee pie te Paper = 20121
cost: |
i val
Particulars « 4
(i) Subsidy wx
(ii) Sales Bs
(iii) Depreciation io
(iv) Exports
(v) Closing stock 20
(vi) Opening stock 50
(vil). Intermediate purchases 500
(vil) Purchase of machinery for own use 200
(ix) Import of raw material 60
Solution:
Net Value Added at Factor Cost
= Gil) + (v)~ (2i)- (vit) - Gi) + O
0 - 30 + 40 = & 280 Lakhs
= 800 + 20 - 50-50
Ans. % 280 Lakhs
Note: * Itis assumed that’ ‘exports are already included in Sales.
is not included separately as itis a part of Intermediate Purchases.
+ Import of raw materials
2 subsidy is added as indirect faxes are not given. oe
Ass Introductory Mac;
from the following data:
ICBSE, 2029 (59,
Example 7. Calculate Net Value Added at Factor Cost
Petes
1 (Dara producer goods ih aie span of 109889) nal
| (9 Single use producer goods.
| © Sie %
| (fh) Unsold Goods (Stock), :
| (\) Goods and Services Tax (GST) !
Solution:
Net Value Added at Factor Cost
= Siles + Unsold Goods (Stock) Single use producer goods ~ Goods and Services
Tax (GST) - Depreciation*
=2042-5-1-1
=@5 lakhs 10 lakhs
Depeiton e ToYears = 14
Ans. @15 lakhs
‘Change in Stock’ from the following data:
Example 8. Calculate the value of
(CBSE, 2020 (58/10)
( Particulars Zin crores
() Sales 400
(i) Net Value Added at Factor Cost (NVAg.) 200
(ii) Subsidies 10
| (fv) Changs in Stock 2
| (v)_ Depreciation 40
| (vi) Intermediate Consumption 400
Solution:
Calc ulation of ‘Change in Stock’
NVAyg = Sales + Change in Stock - Intermediate Consumption — Depreciation + Subsidies
It implies:
Change = NVA;¢~ Sales + Intermedii i AA
a fc + Intermediate Consumption + Depreciation - Subsidies
= 200-400 + 100 + 40-10 = 8 (-)70 Crores
‘Ans. Change in Stock = ® (-)70 Crores urement of National Income
(i) Single use producer goods
(ill) Sales
(iv) Unsold output produced during the year
(v)_ Taxes on production
Solution:
Net Value Added at Factor Cost
jon - TAXES on
=Sales + Unsold Output ~ Single use producer goods ~ Depreett tie span 19
=20+2-5-19-1 {Depreciation = Cost of Proc
= 215 lakhs
Ans. 715 lakhs
Example 10. Calculate Gross Value Added at Factor Cost:
Units of output sold (units)
30
(i) Price per unit of output (%)
1,000
| (il) Depreciation (2)
(iv) Intermediate cost (®) 12,000
(v) Closing stock (2) 3,000
(vil). Opening stock (%) 2,000
6,000
(vi) Goods and Services Tax or GST* (8)
“Becise Duty and Sales Tax given in the question earker have been replaced by GST.
Solution:
Gross Value Added at Factor Cost
= (ixii) +v-vi-iv-vii
= (1,000 x 30) + 3,000 - 2,000 - 12,000 - 6,000
= 213,000
Ans. 713,000 =
Introdiueto
440
Example 1, Frome
Puuticulars
() Total Salos
(li) Decrease in Stock
(ii) Production for Solf Consumption
| (Wy). Purchaso of raw matorials
|) Exports
(vi) Eloctricity Charges
(vil) Income Tax
| (vill) Goods and Services Tax (GST)
| (ix), Subsidy
ceese ee) ee i
Solution
Net Value Added at Factor Cost
= Total Sales + Production for Self Consumption — Decrease in Stock - Purchase ofr,
materials - Electricity Charges - (GST - Subsidy)
= 1,000 + 120-70 - 300 - 50 - (70-40)
670 Crores
Ans. % 670 Crores
Note: * Exports will not be taken separately as its a part of Total Sales.
* Income Tax is not taken in calculations as itis a direct tax.
Production for Self Consumption will be separately included in value of output as it also adds
current flow of goods and services and is not included in total sales.
+ Intermediate Consumption is calculated as sum of (iv) and (v) item.
Example 12. From the following data, calculate: (a) Value of output; (b) Intermediz:
Consumption; (c) Net value added at factor cost.
Tp oe a a 7 7
i Perseiers ea a en cra]
(i) Purchase of raw materials from domestic market 400
| (i) Increase in the unsold stock Juco eo
(ii) Import of raw material } 120
(iv) Domestic Sales | 4,200. |
(v) Replacement of Fixed Capital 50 |
| (vi), Power Charges | 20 |
| (vil) Exports | 200° |
| (ii) Import of Machinery | 40 '|
(x) Goods and Services Tax (GST) | 10 |
(x) Subsidy | 30
10
(xi)_Goods used for self Consumption | CO SI
af
Measuremontot National in
Solution:
a) Value of Output if
= Domesti ed for #6
eSeine * Bert tenets in to ack COO f
i = 1,200 + 200 +60 +10
= 81,470 Crores os
oe eee Included as domestic sales are given. i sence ve
: i setConsumptionwitasobeicudodasiieass 07"
(b) Intermediate Consumption ater
rane materia from domestic market + Import mae
= 400+ 120+20
= 7540 Crores
(0) Net value added at factor cost _Subsidy)
= Value of Output -Intermediate Consumption - (Goods ana services
— Replacement of Fixed Capital
= 1,470 - 540 - (10 - 30) - 50
= £900 Crores
Note: Replacement of Fixed Capita is another name for depreciation.
Example 13. From the following data, calculate Net Domestic Product at factor cost.
Fate GE 5 Fin Crores
ier Primary ‘Secondary
Sector |_| -=_ Seetor
(Sales 7,000 7,500 700
(i) Net Indirect Taxes 50 30 a
(ii) Opening Stock 50 40 20 |
(iv) Intermediate Consumption 300 750 250
10 80 eo, |
| (v)_ Consumption of Fixed Capital
Net Domestic Product at factor cost
sumption of all
«= Sales of all sectors ~ Opening Stock of all sectors = Intermediate Cons!
sectors ~ Consumption of Fixed Capital of all sectors ~ Net Indirect Taxes of all sectors
= quan + 1500+ 70) =(0-+40+20)~ 00 + 750+ 280) (10 +60 +60) (60 + 30 + 0)
=% 1,560 Crores
‘Asells to firm B for €50 crores and for 270 crores to private consumpti
80 crores to firm C, Firm C sells for & 100 crores to private fg
ption.
Band C.
Example 14, Firm
Firm B sells for €
Calculate value added by Firm A, |
Introductory Macroac
cadatah r fiealsd di je Consumption | Value Add 7
Ns oat “] interme Bt) lL wasvor
Sales to B: 50 value of Inputs: o
+ Sales to Pvt. Cons.: 70
B | Salestoc: 80 | Purchase from A: Se
C | Sales to Pvt. Cons.: 700 | Purchase from B: 89
A
Value added: Firm A = % 120 crores; Firm B = € 30 crores; Firm C=%20 crores.
Note: Value of inputs of firm A is taken as zero as itis not given-
Example 15. Firm A buys from X inputs worth & 500 crores and sells to firm B goods wor,
% 1,000 crores and to firm C goods worth & 700 crores. Firm B buys from Y inputs worth %a9,
crores and sells to firm C goods worth @ 1,500 crores and finished goods worth % 2,000 crores
to households. Firm C buys from Z inputs worth & 150 crores and sells finished goods wor,
% 4,150 crores to households. Calculate value added by firms A, Band C and GDPyyp.
Solution:
Firm Value of output Intermediate Consumption Value Added
(vo) (IC) (VA=VO-IC)
A | Sales to B: 1,000] Purchase from X: 500
+ Sales to C: 700 1,200
B | SalestoC: 4,500| Purchase from A: 1,000
+ Sales to households: | 2,000) + Purchase from Y: 200 2,300
C | Sales to households: 4,150) Purchase from A: 700
+ Purchase from B: 1,500 1,800
+ Purchase from Z: 150
Value added by firm A=GVAypofA = 1,200 crores
Value added by firm B = GVAyp of B = % 2,300 crores
Value added by firmC=GVAypofC = 1,800 cores
GDP yp= ZGVAyp = 1-200 + 2,300 + 1,800 = 5,300 crores
Example 16. Inan economy, the following transactions take place:
'A sells goods of € 20 crores to B, € 30 crores to C, % 40 crores to households and good
worth Z 10 crores remain unsold. Value of inputs of firm A is assumed to be zero.
Beellshis output worth &40 crores oC, & 60 crores to Dand % 50 crores to final consumptio®
C sells his output worth % 100 crores to D, % 100 crores to households and exports Wo"
2100 crores.
Dells % 300 crores to households and @ 100 crores to government.
Calculate: (i) Value Added by each firm; (ii) Total Value Added; (iii) Total Consumpti*
Expenditure.
ee . .rtt—lrc ese
—— | 443
‘Measurement of National income
+ Sales toC: 30
+ Sales to households: | 49
+ Unsold stock: 10
Sales to C:
See e Purchase from A:
+ Sales to households: | 50 Ms
7 00 TP
Sales to D: 100 | Purchase from A: 30
40
+Sales to households: | 100 | Purchase from B:
+ Exports: 400
D_| Sales to households: | 300 | Purchase from B: 60
100 | Purchase from C: 100
+ Sales to Government:
(i) Value Added by each firm
Value added by firm A = GVAyp of
Value added by firm B = GVAyyp ofB = %130 crores
e added by firm C= GVAyp of C = % 230 crores
of D = %240 crores
‘A = %100 crores
Valu
Value added by firm D= GVA
(ii) Total Value Added
= 100 + 130 + 230 + 240 = %700 crores
GDP yp = 5 GVA
(iii) Total Consumption Expenditure a
= Sales to households by A +: Gales to households by B+ Sales to households by C+Sales
to households by D + Sales to government by D
= 40 +50 + 100 + 100+ 300
= © 590 crores
Note: Fee pn cpersaaraus eraser HOI: ‘and governmenton purchase
of goods and services fro7 different firs.
Example 17. In an economy, industry P sells output to Q. Q sells output to R for % 600. Q’s
value added is 4 of P’s value added. ‘Assuming P’s value of inputs are 0, calculate how much
Psells toQ.
Solution: Suppose, Sales by P 10 Qe=x
Fim] value a stra 7 reside remap Value Added
(ee vem ofinpis iO (VA=VO-IC)
P | Salesto x _| Value of inputs: jie)
© | Salesto R: 600 | Purchase tromP: x ti, Value added by firm Q = 600 ~ x
Given, Q's value added is #4 of P's value added
2
Avs Psells to Q output worth & 400 :
Example 1S. Sales by Firm A are & 80 crores and sales by firm B are ae Valueady
by Band C are equal. Value of output of C and D are : als Fs i aa addeg ;
is £120 crores and GDP ip is ® 520 crores. Assuming A’s val Win , fee Caleuia,
@ Vi"'ue added by firm Band firm C; (Gi) Value of Inputs of firm B; (ii) Value of Inputs
3 = 7400
Tt means: 600 ~ x etx or 2x = 600 or x
Offi
Solution:
Given: Value added by firm B = Value added by firm C
Let the value added by firm B = x
Tt means: Value added by firm B = Value added by firm C = x
Value of Inputs of firm D
= Value of output - Value Added = 280 — 120 = 160
Value of inputs of firm B and firm C are taken as Vip and VI. respectively
| Firm j Value of output Value of Inputs Value Added]
fees | (Vo) vw (VA=Vo-vy
A Sales: 80 _| Value of inputs: 0 80
__B | Sales: 300_| Value of inputs: Vig x
_o | Sates: 280 _| Value of inputs: Vig x
__D |Sales: 280 _| Value of inputs: 160 120
L GDP yp 520
Value added by firm A = g9
Value added by firm B x
Value added by fimC = x
Value added by firmD = 120
GDPyyp = 520
It means:
80+x+x+120=520
2x = 520-200 or x = 8 160 crores
Value of Inputs of firm B
= Value of output ~ Value Added = 300 — 160 =
7140 crores
Value of Inputs of firm C
= Value of output Value Added= 280 160 = € 120 croreg ns
a BZ
fim
to
alue added by firm C = % 160 cron
7 140 crores; (ii) Value of Inputs of firm C = 8120 crores ) Value of Inputs of
se 19. Firm A spent 2 500 crores on non-factor. inputs and sold goods worth % 600 crores
ty) 4 n
Be a Band © 300 crores to firm C. Firm B whose value added is & 1,000 crores sold half its
to firm C and half to firm D. Value added by firm C is 4 of value added of firm D. Firm
ul ae
oe i{Firm Dsold their entire output to households, Value of Output of frm Cis equal to firm
Bs
Cs
Cs
So,
D's Value of output = Value a
Jue of output. Calculate value of output of firm D,
Value of output Intermediate Consumption | Value Added
Jei(VO).p diese 9 WwtbiG i (0) Lait ts] (VA'=VO=1C)
Sales t0 B: Non-factorinputs: 500
+Sales to C: 400
Sales to C: 800 | Purchase from A: 600
+ Sales to D: 800 1,000
Zales to households: 1,600 | Purchase from A: 300 500
+Purchase fromB: 800
D | Sales tohhouseholds: 7,800 | Purchase fromB: 600] 1,000
Value of output = Value added + Intermediate consumption = 1,000 + 600 = 1,600
Value of output = B's Value of output = 1,600
Value Added = 500 = #4 of value added of D
D’s Value Added = 500 x 2= 1,000
idded + Intermediate consumption = 1,000 + 800 = 1,800
‘ans Value of output of firm D = © 1,800 crores
Example 20, Calculate NDP at FC.
Practicals on Income Method
Particulars Tin Crores
(Rent 400
(i) Royalty 200
(ii) Interest 500
(iv) Compensation of Employees 1,000
(v) Profit 500
(vi) Mixed Income 1,000
Solutions
NDP at FC
=Rent + Royalty + Interest + Compensation of Employees + Profit + Mixed income
= 400 + 200 + 500 + 1,000 +500 + 1,000 = € 3,600 crores
Ans, %3,600 crores
Example 21, Calculate GNP at MP from the following data:
Particulars Tin Crores |
() Netindirect tax 900
400
(i) Depreciation | Gil) Net Factor income from abroad
| (iv) Rent
| (v)_ Dividend
| (vi) Mixed Income
(vil) Saving of private corporate sector
(vii) Interest
__(e¢)_Compensation of em;
Solution:
GNP at MP
= Rent + Dividend + Mixed income + Saving of private corporate sector + Int
+ Compensation of employees + Net indirect tax + Depreciation + Net F;
income from abroad ee
= 1,000 + 500 + 200 + 400 + 200 + 100 + 900 + 400 + (-) 20 = % 3,680 crores
Ans. % 3,680 crores
Calculate National Income.
| Particulars
() Compensation of employees
| qi). Wages in kind
(ii) Indirect taxes
(iv) Gross domestic fixed capital formation
(v) Operating surplus
| (vi) Mixed income of self employed
(vii) Net factor income from abroad
(viii) Net exports
Solution:
National Income (NNP;)
= Compensation of employees + Operating surplus + Mixed income of self employed
+ Net factor income from abroad
= 13,300 + 5,000 + 16,100 + 300 = 34,700 crores
Ans. % 34,700 crores
Note: * Wages in kind are not included separately as they are already included in ‘compensation of
‘employees.
Gross domestic fixed capital formation is given just to create confusion.
Operating surplus is the sum total of income from property (rent + royalty + interest) and income
from entrepreneurship (profit). :
Example 23. From the following data, calculate National Income. Sample Paper 208
Particulars
() Compensation of employees
(i) Rent
Example Measurement of National income
) Wages and Salaries
(W)_ Net exports ‘ Es
()_ Net Factor incor a
(wi). Proft "me from abroad oe
(vii) Interest 400
(vii) Depreciation 0
Solution:
National Income (NNP,.)
= Compensation of Emy broad
ployees + Rent+ Profit In factor Income from Al
800 + 200+ 300+ 1007 ¢ ny fit + Interest + Net factor
400-20
= 21,380 crores
Ans. 71,380 crores
Practical on Value Added and Income Meth. J
Example 24. From the following information, estimate: (i) Value of output; (ii) Net value added
at factor cost; (iii) Prove that income generated is equal to net value added at factor cost.
[Particulars TT ein Crores
()_ Increase in unsold stock 600
(i) Sales 10,625
(ii) Purchase of raw materials 2,625
(iv) Indirect Taxes 1,200
(v) Subsidies 400
(vi) Operating surplus 3,740
(vil) Mixed incomes 100
(vii) Wages and Salaries 3,460
(x) Depreciation 500
Solution:
() Value of output
= Sales + Increase in unsold stock
= 10,625 + 600
=% 11,225 Crores
(ii) Net Value Added at Factor Cost
=Sales + Increase in unsold stock ~ Purchase of raw materials - Depreciation —
(Indirect taxes - Subsidies)
= 10,625 + 600 - 2,625 - 500 - (1,200 - 400)
=%7,300 Crores Introductory Maer,
To prove Income Generated = Net Value Added at Factor
Income Generated
= Operating surplus + Wages and Salaries + Mixed incomes
= 3,740 + 3,460 + 100 = % 7,300 Crores
So, Net Value Added at Factor Cost = Income Generated = 7,300 crores
Practicals on Operating Surplus
Example 25. Calculate the Operating Surplus.
Particulars Zin Crores
(i) Sales 4,000
(ii) Compensation of employees 800
(ii) Intermediate consumption 600
(iv) Rent 400
(v) Interest 300
(vi) Net indirect taxes 500
(vii) Consumption of fixed capital 200
(vil)_Mixed income 400
Solution:
Operating Surplus
= Sales — Intermediate consumption - Compensation of employees ~ Net indirect
taxes - Consumption of fixed capital - Mixed income
= 4,000 - 600 - 800 - 500 - 200 - 400
= 1,500 crores
Ans. % 1,500 crores.
Exe ae
Operating Surplus can also be calculated in one more way:
We know, GDPyp can be calculated as:
GDP yp = Operating Surplus + Compensation of employees + Mixed Income
+ Consumption of fixed capital + Net indirect taxes
oR
GDPyyp = Value of output - Intermediate Consumption
{Where, Value of output = Sales + Change in stock}
Using (a) and (b), we get the following formula of Operating Surplus:
Operating Surplus = Value of Output - Intermediate Consumption - Compensation of
employees - Mixed Income - Consumption of fixed capital - Net
indirect taxes | (i) Purchase of raw material
| (iii) Net indirect tax 20
| (u)_Wages and salaries
Solution:
Operating Surplus
= Value of output Purcha:
se of ie
= 70,000 - 18,000 - 3,000 Hoeaoott material -Net indirect ta
= % 24,000 crores 3
‘Ans. © 24,000 crores
ie Wagesand
Practicals on Expenditure Method
Calculate GDP at MP
(i). Government Final Consumption Expenditure
| (i) Gross Fixed Capital formation
|v). Change instock
| (v)_ Imports
| (vi) Exports
Solution:
GDP at MP
= Private Final Consumption Expenditure + Government Final Consumption
Expenditure + Gross Fixed Capital formation + Change in stock + (Exports ~
Imports)
= 1,200 + 200 + 300 + 400 + (600- 500)
= %2,200 crores
‘Ans. © 2,200 crores
Example 28. Calculate GNP at FC: =
ear) Net domestic fed capita formation 350
(i) Closing stock | 100
(i) Government final consumption expenciture eal
(iv) Net indirect taxes |
(v) Opening stock ac? |
(4) Consumption of fixed capital | is
()10
(vil) Net exports Ns
Introductory Macro,
450
(vill) Private final consumption expenditure
(&) Imports
(%)_Net tactor income trom abroad
Solution:
GNP at FC
= (i) + UG) — (v)) + Gitys (viii) (vii) + (Wi) - Gv) + ©)
= 350 + {100~ 60) + 200 + 1,500 + (-) 10+ 5040+ (30
= & 2,060 crores
Ans. 72,060 crores
Example 29.Calculate ‘Gross Domestic Product of Factor Cost’ from the following data,
(CBSE, Sample Pape 5
Particulars Ein crores
(i) Private final consumption expenditure 800
(i) Net domestic capital formation 150
Gil) Change in stock 30
(iv) Net factor income from abroad 20
(v) Net indirect tax 120
(vi) Government final consumption expenditure 450
(vil) Net Exports (30
(viii). Consumption of fixed capital 50.
Solution:
Gross Domestic Product at Factor Cost (GDP,,)
= (i) + (vi) + (ii) + (vii) + (viii) -(v)
= 800 + 450 + 150 + (-30) + 50-120
= 71,300 crores
Ans. 71,300 crores
Example 30. Calculate Gross Fixed Capital Formation from the following data:
(CBSE, Sample Paper. 20M
Particulars i ee] Rinerores
(Private final consumption expenditure 4,000
(i) Government final consumption expenditure 500
(ii) Net exports oe"
(iv) Net factor income from abroad dl
(v) Gross domestic product at market price 2,500
(vi) Opening stock: ; : a
(vil) Closing stock a
Oa a rae nde at a Measurement of National Income 454
EB Gross Fived Capital Formation
== ~ Gi) ~ Gi) ~ yy
)~ (vi)
= 2,500 ~ 1,000 ~ 500 ~ (-)
50~ (200-300)
Ans. £1,150 crores
Miscellaneous Practicals
Example 31. Calculate National Income by Income and Expenditure
method.
Final Consumption Expenditure
— Private Sector 350
— Government Sector 100
(i) Mixed income of self employed ie 35
| i) Gross domestic fixed capital formation 70
(Opening stock 15
(¥) Compensation of employees 250
(Wi) Closing stock 25
(vii) Imports 20
(vill), Rent 75
(&) Consumption of fixed capital 10
(x) Net indirect taxes 25
(xi) Interest 25
(xil) Net factor income from abroad 5
| Gx) Exports 10
| |i) Profit 100
| Solution:
National Income by Income method
= Mixed income of self employed + Compensation of employees + Rent + Interest
+ Profit + Net factor income from abroad
= 35 + 250 + 75 + 25 + 100 + (-5)
= 7480 crores
Ans. 480 crores,
National Income by Expenditure method
= Final consumption expenditure of Private sector+ Final consumption expenditure
of Government sector + Gross domestic fixed capital formation + (Closing stock— aN
Opening stock) + Net Exports ~ Consump! 1n of fixed capital + Net rng
from abroad - Net Indirect tax
= 350 + 100 + 70+ (25 ~ 15) + (10-20) - 10+ (-5)- 25
= 480 crores
Ans. % 480 crores.
Example 32. Calculate National Income by Income and Expenditure method.
Particulars TT a [en
{) Compensation of employees 250
(i) Imports 20
(ii) Mixed income of self employed 50
(iv). Gross fixed capital formation 420
(v)_ Private final consumption expenditure 550
(vi) Consumption of fixed capital 40
(vii) Net factor income from abroad 20
(vii) Indirect taxes 100
(ix) Change in stock 20
(x) Subsidies 20.
(xi) Rent 100
(xii) Interest 200
| (xi) Profit ~ 50
(xiv) Exports 10
(ev) Government final consumption expenditure 60
Solution:
National income by Income method
t + Interest
= Compensation of employees + Mixed income of self employed+ Ren
+ Profit + Net factor income from abroad
= 250 +50 + 100 + 200 +50 + 20
= 670 crores
Ans. % 670 crores.
National Income by Expenditure method
= Gross fixed capital formation + Change in stock + Private
expenditure + (Exports - Imports) + Government final consumption expendi
- Consumption of fixed capital + Net factor income from abroad - (Indirect taxes
~ Subsidies)
= 120 + 20 + 550 + (10-20) + 60-10 + 20 - (100 = 20)
Final consumption
jiture Measurement of National income
670 crotes
Ans. © 670 crores.
paample 33. From the js
following data, calculate National Income by (a) Income method and
icBse, Delt 2006)
Private final cor i
Net capital ‘onan oa
| (iii) Change in stock
| (fv) Compensation of employees
(v) Rent
(vi) Interest
(vil) Operating surplus
(vii) Net indirect tax
| (x) Employers’ contribution to social security schemes
| (x) Net exports
(xi) Net factor income from abroad
| Gi) Government inal consumption expenditure
| (xii) Consumption of fixed capital
Solution:
National Income (NNPp¢) by Income method
= (iv) + (vii) + @)
= 1,900 + 720+ (-) 20
= %2,600 crores
‘Ans, € 2,600 crores.
National Income (NNPgc) by
= (i) + (ii) + (0) + Oi) - (viii) + Gd)
= 2,000 + 400 +20 + 600-400 + (20
= %2,600 crores
Ans. & 2,600 crores.
Example 34. From the following data, calculate National Income by Income and Expenditure
{CBSE, Sample Paper 2012}
Expenditure method
meds _
[Paedars as
0 Government inal consumption expenditure sal
(i) Subsidies
(ii) Rent
(iv) Wages and salaries
(v)_ Indirect taxes 454
aa aan a SS OESTNGTICN Hay SS
| (v8) Gross domestic capital formation
| (Vi) - Social security contribution by employer
9) Rey
(). Net factor income paid to abroad
(3) Interest
(a) Consumption of fixed capital
(x) Profit
(xv)_ Change in Stock
Solution:
National Income (NNP;) by Income method
= (iv) + (will) + (ii) + (&) + (Xi) + (Adil) -()
= 600 +55 +200 +25 + 20+ 130-30
= 71,000 crores
Ans. 71,000 crores.
National Income (NNP,c) by Expenditure method
= (vi) + (i) + (vii) + (xiv) - {(v) - Gi} - (i) - (&)
= 800 + 100 + 120 + 70 - {60-10} - 10-30
= % 1,000 crores
Ans. %1,000 crores.
Example 35. Calculate national income by Income and Expenditure method from the following
data:
Salaries and wages in cash
(@) Transfer payments by govemment 25
(i) Rent 182
(W) Indirect taxes 200
(¥) Subsidies 89
(vi) Compensation of workers in kind 95
(vil). Depreciation 81
(vill) Net increase in factor income from rest of the world so
(@) Interest 92
(x) Govemment expenditure on good and services S74
(xi) Personal consumption expenditure on goods and services 1,805
(xi) Corporate profit tax 10
(xii) Income of the self employed 264 a] ASS
mm”
| (xv). Undistributed corporate profit 26
(«v) Dividends i
| (ni) Export of goods and services 200
(xvi) Addition to stock 7
“¢evi) Social security contributions by employer 54
| (xix). Import of goods and services 323
| (@x)_ Gross fixed investment 400:
Solution:
National Income (NNPgc) by Income method
2 (+ (ii) + (vi) + (Will) + (bx) + (xii) + (xii) + (xiv) + (xv) + Gxviii)
997 + 132 + 95 +52 +92 + 10 + 264 + 26 + 201 + 54
2,923 crores
Note: * ‘Compensation of Employees’ is calculated as the sum total of (i), (vi) and (xvii).
* Profit’ is calculated as the sum total of (xii), (xiv) and (xv).
National Income (NNPy¢) by Expenditure method
=(x) + (xi) + [0000 + (xvii) + {( Sr rere ESET
M
nt of Nat
(v) Exports ‘umption expenditure
(¥) Opening stock
(vi) Government fir
i I fing
(vii) Imports ae
(vill) Net domestic
ic fixed capi
(&)_Net factor income oa ae
roa
tumption expenditure
60. Calculate national income:
(CBSE, Delhi Come!
RRL cue
Particulars
[ein a OTS
wail OS a aeeketne ter:
(i) Net domestic capital formation wahcitna Ye
(i) Government final
(" consumption expendit
(iii) Net factor income from eae ar
{iv) Private final consumy
iption expenditur
(v) Depreciation -
(vi) Net exports
(vil). Net indirect taxes
a eT ae
(ii) Private final cong 4429
SSssygs
Lapa 790890
tt. 2014)
National Income = 7990 Crore
tt. 2014}
61. Calculate national income: (CBSE, All naia Comp!
Particulars = Zin crores
| (i) Net current transfer from rest of the world 90
(i) Private final consumption expenditure 00
(ii) Net domestic capital formation 100
(iv) Change in stock 29
| (v) Depreciation 20
(vi) Government final ‘consumption expenditure 200
| (vil) Net exports a
| (Wily Net indirect taxes 80
| (@)_ Net factor income paid to abroad 10,
National Income = 650 Crore
Miscellaneous Practicals
62. From the following data relating to an economy, calculate (a) National it
income using Expenditure
1 employees from abroad
(iv) Net compensation
Method; (b) National income using Income Method.
Particulars Zin crores
(i) Government final consumption expenditure 5,100
(i) Gross fixed capital formation 9,029}
(ii) Export of goods and services 28 00!
a 4.130
rest
(©) Net property and entrepreneurial income from
{¥) Change in stock
(vi) Consumption of fixed capital
(vil) Private final consumption expenditure
(9 Import of goods and services
(&) Net indirect taxes
(xi) Compensation of employees
Gai) Operating surplus
63. From the following i ormati
Particulars
(Personal Consumption expenditure
(ii) Social security contribution by Employers
(ii) Net indirect taxes
(iv) Interest
(v) Government ‘expenditure on goods and services
(vi) Rent
(vii) Undistributed profits
(vill) Dividends
(%) Wages and salaries in cash
& ‘Tax on corporate profits
(xi) Net domestic investment
(xi) Depreciation
(xii) Net exports
(xiv) Income of the self-employed
(xv)
64. Calculate Gross National Product at Market Price,
Particulars
(ii) Profit
(ii) Social security contribution by employers
(iv) Mixed income
(v) Gross domestic capital formation
(vi) Royalty
(vii) Interest
(viii) Compensation of employees
of the world
xi) Mixed income of the self employed :
LG) Mixed income ofthe s ,
calculate GNPyyp by income. and expenditure methods,
Net factor income from abroad
—T Fincrores
De eae
() Rent
Introductory Macroeeong
Sey
| 316
| 2,323
|
|
|
3,023 |
42,065
3,177
5,168
110
| sf
L
65.
4134
easurementof National Income
120
(ox) Net domestic capital formation
~~ @ Exports
| Gi) Private final consumption 2
tae expenditure (20
(v)_Net domestic capital formation F
(v)_ Net factor income to abroad “0
(vi) Depreciation 7
(vil) Change in stocks 20
| (wi) Net indirect tax 0
200
Le LOO
. 2015 (I)
(%)_Government final consumption expenditure —;
Tar Domestie Product at FEC
(CBSE.
66. Calculate Net Domestic Product at Market Price:
(i) Private Final Consumption Expenditure
|i) Opening stock io
| ii) Consumption of Fixed Capital .
(iv) Imports e
(v) Government Final Consumption Expenditure 80
(vi) Net factor income to abroad os
(vil) Gross Domestic Fixed Capital Formation 80
| (vil) Closing stock 20
(x)_ Exports o
‘Net Domestic Product at Market Price = © 550 Crore
67, Calculate Net National Product at Market Price. (CBSE, Foreign 2015 (uy
Particulars 2
to abroad
() Net Factor income
tributions by employees
(i) Social security con
(ii) Consumption of fixed capital 40
ma) Compensation of employees 300
| (v) Corporate tax + 30
| (Wi). Undistributed profs a
| (vil) Interest Hs
(viii) Rent nis
(ix) Dividends -
140
(x)_Net Indirect tax.
& cm
Net National Product at Market Price = & 1,070 C1
,070 Crore () Sales
Opening stock
Depreciation
'ntermediate consumption
Exports
vi Change in stock
(vii) Net indirect taxes
88. Calouta
It
te National Income, sean the - :
SS a hoe
() Private finar Consumption expenditure 400
(i) Net domestic fixed capital formation
(ii) Net tactor income from abroad i
() Change in stock 2
(¥) Net exports s
(vi) Netindirect taxes a
li) Mixed income a
(Will) Government final consumption expenditure 200
(%) Consumption of fixed capital 2
N
Introductory rena
saesee
1 |
Net Value Added at Factor Cost = # 455
70. Calculate Net National Product. at Factor Cost:
"National income = 7840 Cre
(ix) Consumption of fixed capital
{CBSE, Delhi Compt. 2015 )
Particulars Zin crores
wi Government final consumption expenditure 500
(i) Mixed income 1,500
(iil) Net indirect taxes 100
(iv) Net exports 60
(v)_ Change in stock (50
(vi) Net factor income to abroad 70
(vii) Net domestic fixed capital formation 250
(vill) Private final consumption expenditure 2,000
30
71. Calculate gross value added at factor cost.
Net National Product at Factor Cost = ¥2.690 Crit
{CBSE, All India Compt. 2015 (il
Particulars
Zin crores
(i) Domestic sales aoe
(ii) Change in stock —
(ii) Depreciation 2
(iv) Intermediate consumption = ies OO ——————_-———
4133,
roasuroment of National
|) Exports
(W)_ Indirect taxes 260
| 50.
ay]
Net factor in
stseorincomefromabroad cost”
. From the following d Gross Value Ad009
7 9 data, calculate Gross National Product at Matket PACE 1 nda comet!
(C85
() Dividends — saa — as
(i) Compensati ~
| Gil) Rent mmchenises, as
(v) Depreciation a
(v) Interest a
(i) Net factor income to abroad ve
(vil) Mixed income 5,000
(vii), Netindirect taxes e
et se ceneeinmeeaense RS re
- arPricg = 11,900 6
cast ane ER
Paice — Zin crores,
() Compensation of employees F : ce
(i) Dividend oe
(ii) Mixed income es
(iv) Social security contribution by employers 400
(v)_ Net factor income to abroad °
(vi) Net indirect taxes 1,000
(vil) Rent |
(vil) Consumption of fixed capital 1,200
(x) Profit 4.500
700
() Interest
‘Net Domestic Product at Market Price = € 16,000 Crore
{CBSE, Delhi Comptt. 2016 (!)}
74, Calculate Gross National Product at Factor Cost.
petiolate Zin erores
(i) Rent 400
(i) Compensation of employees 3,000
(iil) Dividend 200
(iv) Change in Stock 300
(y)__ Net factor income to abroad von
800
(vi) _ Net factor taxes I
4.134
(Vi) Consumption of fixed capital
(vil) interest
(x) _ Profits
Gross Na
75. C,
()__ Private final consumption expenditure
(ii) Government final consumption expenditure
(ii) Exports
(v) Imports
(v) Consumption of fixed capital
(vi) _ Gross domestic fixed capital formation
(vii) Change in stock
(vil) Factor income to abroad
(ix) _ Factor income from abroad
| 0). Indirect taxes
| (i) Subsidies
vonal Product at Factor Cost= £11,109,
oN
Introductory Maco2¢cn,
1,000
600
800
6,000
(CBSE, Dat 20%7 9)
8,000
1,000
70
120,
60
500,
100
40
90
700
50
(30
(xii) _Net current transfers to abroad
"Net Domestic Product at Factor Cost = 8,840 Cray
76. Calculate National Income: {CBSE, All india 2017 (y
Particulars (erores)
(i) Compensation of employees 2,000
(i) Rent 400
(iii) Profit 900
(i) Dividend 100
(v) Interest 500
(vil). Mixed income of self-employed 7,000
(vii) Net factor income to abroad 50
(vii) Net exports 60
(ix) Netindirect taxes 300
() Depreciation 450
30
(xi) _Net current transfers to abroad
77. Calculate Net Domestic Product at Factor Cost:
‘National income = € 10,750 CR
{CBSE, All India Compt. 2017 (!))
| Particulars aaa
() Dividends 5
jo Social security contributions by employers ia
| Gi) Corporate profit tax 2
| (iy) Consumption of fixed capital a
(v) Net factor income to abroad 9 ra
=>:
yoosoroment of Nationa Income we
(vi) Retained ear
|W mings
(vil) Interest 95 of private corporate sector a
| (vi) Net current tra
nsf
a oe fs to rest ofthe world oo
(x) Netindirect tax 2
_(s)_Gompensationotempioyees
N of employees 60 7950608
: —roaatat Fae” 8 yet nd
za. Gwen the following data, find a on Bog
‘operating Surplus’. ind the missing values of ‘Private Final consume pol 2019)
Particulars 5 ine
(i) National Income 50%
(ii) Net Indirect Taxes fiom
ii) Private Fi i :
wi pe Final Consumption Expenditure 5
(iv) Gross Domestic Capital Formation Lhe
(v) Profits 10
(v)_ Government Final Consumption Expenditure ee
(vii), Wages and Salaries 20,000
(vii) Consumption of Fixed Capital OO
(ix) Mixed Income of Self Employed 130
(x) Operating Surplus ‘
(xi) Net Factor Income from Abroad am
2,000
‘surplus = 16,500 crores
78. Given the following date, fi
and Salaries’
~ Zin crores
Mixed Income of Self Employed 00
(iy) Net Indirect Taxes 300
(ii) Wages and Salaries 2
(ju) Government Final Consumption Expenditure 14,000
(v)_ Net Exports 3,000
(vi) Consumption of Fixed Capital ns
| (vip. Net Factor Income from Abroad a
| (viiy. Operating Surplus ‘300
| (a National Income rao
(x) Profits 500
(xi) Gross Domestic Capital Formation ;
Private Final Consumption Expenditure 11,000
|_ (xi) Net Exports
Private Final Consumption Expe
ind the missing values of
malture = 19,700 Crores; Opera
“Gross Domestic Capital Formation’ and
(CBSE, Delhi 2019 (uD)
‘wages
Gross Domestic Capital Format
=e),
jon = & 1,900 Crores; Wages and Salaries = ® 13,800
Crores Introductory Macy y
4.136