BHATNAGAR INTERNATIONAL SCHOOL, PASCHIM VIHAR
CLASS 12 – ECONOMICS
REMEDIAL – WORKSHEET 1
TOPIC : MEASUREMENT OF NATIONAL INCOME
1) Expenditure Method (GDPmp)
Private Final Government final Gross Domestic Net Exports
Consumption + Consumption + Capital Formation + = GDPmp
Expenditure Expenditure (GDCF)
(PFCE) (GFCE) Exports (X) --- Imports (M)
Gross Fixed + Inventory
Capital Formation Investment
Household Private Non- (Change in Stock)
Final + Profit Institutions
Consumption Serving Households
Expenditure Final Consumption
Expenditure
Net Fixed Capital Depriciation
Formation +
GDFC = Gross Fixed Capital Formation
GDFC = Gross Business Fixed Investment + Gross Residential Constructive Investment
+ Gross Public Investment + Inventory Investment
Domestic Income (NDPfc) = GDPmp – Depreciation – Net Indirect Taxes
National Income (NNPfc) = NDPfc + NFIA
Q 1 Calculate Net National Product at Market Price:
Items (₹ in crore)
1. Gross domestic fixed capital formation 400
2. Private final consumption expenditure 8000
3. Government final consumption expenditure 3000
4. Change in Stock 50
5. consumption of fixed capital 40
6. Net indirect taxes 100
7. Net exports – 60
8. Net factor income to abroad – 80
9. Net current transfers from abroad 100
10. Dividend 100
Q 2. Calculate National Income
Items (₹ in crore)
1. Net factor income to abroad – 50
2. Net indirect taxes 800
3. Net current transfers from rest of the world 100
4. Net imports 200
5. Private final consumption expenditure 5000
6. Government final consumption expenditure 3000
7. Gross domestic capital formation 1000
8. consumption of fixed capital 150
9. change in stock – 50
10. Mixed income 4000
11. Scholarship to students 80
2) Value added method
Value added (GVAmp) = Value of output – Intermediate consumption
Value of output = Sales + Change in stock
Sales = Domestic Sales + Exports
GDPmp = GVAmp of Primary sector + GVAmp of Secondary sector + GVAmp of
Tertiary sector
Q 3. On the basis of the following data about an economy which consists
of only two firms, find out:
a) Value Added by firm A and B, and
b) Gross Value Added or Gross Domestic Product at Factor Cost.
Items ₹ in lakhs
i) Sales by firm A 100
ii) Purchases from firm B by Firm A 40
iii) Purchases from firm A by Firm B 60
iv) Sales by firm B 200
v) Closing Stock of Firm A 20
vi) Closing Stock of Firm B 35
vii) Opening Stock of Firm A 25
viii) Opening Stock of Firm B 45
xi) Indirect taxes paid by both firms 30
Q 4. Calculate:–
a) Gross Value Added at Market Price, and
b) National Income from the following data.
₹ in
Items
lakh
(i) Value of Output:
800
a) Primary Sector
200
b) Secondary Sector
300
c) Tertiary Sector
(ii) Value of Intermediate inputs purchased by:
400
d) Primary Sector
100
e) Secondary Sector
50
f) Tertiary Sector
(iii) Indirect taxes paid by all sectors 50
(iv) Consumption of fixed capital of all sectors 80
(v) Factor income received by the residents from rest
10
of the world
(vi) Factor income paid to non-residents 20
(vii) Subsidies received by all sectors 20
3) Income Method
NDPfc
Operating iCompensation
Surplus Mixed Income of Employees
1. Wages and salaries in
cash
2. Wages and salaries in
1. Profit
kind
2. Rent and Royalty
3. Employer’s Contribution
3. Interest
to social security scheme
Profit = Corporate Tax + Dividend + Retained Earnings
Operating surplus can also be calculated can also be calculated in one more way:
We know, GDPmp = Operating Surplus+ Compensation of employees + Mixed Income + Consumption
of fixed capital + Net Indirect taxes.
Or
GDPmp = Value of output – Intermediate consumption
(where Value of output = Sales + change in stock)
So, Operating Surplus = Value of output – Intermediate Consumption – compensation of
employees – Mixed Income – Consumption of fixed capital – Net Indirect taxes
Q 5. Calculate a) Operating Surplus, and b) Domestic
Income;
Items ₹ in Crore
i) Compensation of Employees 2,000
ii) Rent and interest 800
iii) Indirect Taxes 120
iv) Corporation tax 460
v) Consumption of fixed capital 100
vi) Subsidies 20
vii) Dividend 940
viii) Undistributed Profits 300
ix) Net Factor Income to abraod 150
c) Mixed Income 200
Q 6. Calculate Net National Product at Market Price:
(₹ in thousand
Items
crore)
1. Compensation of Employees 250
2. Mixed income of self employed 600
3. Profit 80
4. Rent 30
5. Interest 40
6. Net factor income to abroad – 10
7. Net exports 15
8. Consumption of fixed Capital 20
9. Net indirect taxes 10
10. Net current transfers to abroad 8
