✓ Board-verified
Economics · 2024 · 3 marks
National Income AccountingCircular Flow of Income and Methods of Calculating National Income3 marksApplyshort answer
CBSE 2024 · Region 1 · Set 1 · Q11
(a) On the basis of the data given below for an imaginary economy, estimate the value of Net Domestic Product at Factor Cost (NDP_FC ): S. No. Items…
On the basis of the data given below for an imaginary economy, estimate the value of Net Domestic Product at Factor Cost (NDP$\displaystyle _{FC}$) :
| S. No. | Items | Amount (in ₹ crore) |
| (i) | Gross Domestic Fixed Capital Formation | $\displaystyle 200$ |
| (ii) | Exports | $\displaystyle 50$ |
| (iii) | Government Final Consumption Expenditure | $\displaystyle 320$ |
| (iv) | Consumption of Fixed Capital | $\displaystyle 35$ |
| (v) | Household Final Consumption Expenditure | $\displaystyle 470$ |
| (vi) | Inventory Investment (Net) | (–) $\displaystyle 40$ |
| (vii) | Imports | $\displaystyle 60$ |
| (viii) | Net Indirect Taxes | $\displaystyle 50$ |
| (ix) | Net Factor Income from Abroad | $\displaystyle 20$ |
(i)
Elaborate the concept of Externalities with the help of suitable example.
(ii)
Define Operating Surplus.
Marking-scheme solution
(a)
Net Domestic Product at Factor Cost (NDP$\displaystyle _{FC}$) = (v)+(iii)+(i)+(vi)+(ii-vii)-(iv)-(viii)
= $\displaystyle 470$+$\displaystyle 320$+$\displaystyle 200$+(-$\displaystyle 40$)+($\displaystyle 50$-$\displaystyle 60$)-$\displaystyle 35$-$\displaystyle 50$
= ₹ $\displaystyle 855$ crore
OR
(b)(i)
Externalities refer to benefits/harms which are caused by one entity to another without being paid/penalised for it.
For example: Newly developed public park
(ii)
Factor income earned in the form of rent, royalties, interest and profits are together called ‘Operating Surplus’.
More from National Income Accounting
- Calculate the values of Operating Surplus and Gross Domestic Product at Market Price (GDP_MP ) from the following data: S. No. Particulars Amount (in…2026
- If the Real Gross Domestic Product is ₹ 16,000 crores and Gross Domestic Product at current prices is ₹ 20,000 crores, calculate the value of price…2022
- Giving valid reasons, explain how the following would be treated while estimating domestic income? (i) Payment made by a Japanese tourist for goods…2022
- To arrive at the value of Net Value Added at Market Price (NVA_MP ), must be to/from Gross Value Added at Market Price (GVA_MP ). (Choose the correct…2025
- Briefly explain the different phases of circular flow of income. OR In an economy, if the Real Gross Domestic Product (GDP) is ₹ 300 crore and Price…2022
- Income generated from Aircrafts of Air India operating between Canada and England would be added to the domestic income ( NDP_FC ) of. (Choose the…2026
- 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…2026
- State any two precautions to be adopted while estimating National Income by Value Added Method. OR State any two precautions to be adopted while…2022
CBSE Class 12 Economics past-paper question from the 2024 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.