✓ Board-verified↻ asked 2×
Economics · 2024 · 3 marks
National Income AccountingCircular Flow of Income and Methods of Calculating National Income3 marksApplyshort answer
CBSE 2024 · Region 3 · Set 1 · Q11
On the basis of the given data, estimate the value of National Income :S.No. Items Amount (in ₹ crore) (i) Government Final Consumption Expenditure $\displaystyle 110$ (ii) Private Final Consumption Expenditure $\displaystyle 200$ (iii) Gross Domestic Fixed Capital Formation $\displaystyle 30$ (iv) Net Exports (–) $\displaystyle 40$ (v) Increase in Stock $\displaystyle 20$ (vi) Consumption of Fixed Capital $\displaystyle 15$ (vii) Indirect Taxes $\displaystyle 60$ (viii) Subsidies $\displaystyle 15$ (ix) Net Factor Income from Abroad (–) $\displaystyle 40$
State any three precautions to be taken while estimating National Income by Expenditure Method.
On the basis of the given data, estimate the value of National Income :
| S.No. | Items | Amount (in ₹ crore) |
| (i) | Government Final Consumption Expenditure | $\displaystyle 110$ |
| (ii) | Private Final Consumption Expenditure | $\displaystyle 200$ |
| (iii) | Gross Domestic Fixed Capital Formation | $\displaystyle 30$ |
| (iv) | Net Exports | (–) $\displaystyle 40$ |
| (v) | Increase in Stock | $\displaystyle 20$ |
| (vi) | Consumption of Fixed Capital | $\displaystyle 15$ |
| (vii) | Indirect Taxes | $\displaystyle 60$ |
| (viii) | Subsidies | $\displaystyle 15$ |
| (ix) | Net Factor Income from Abroad | (–) $\displaystyle 40$ |
State any three precautions to be taken while estimating National Income by Expenditure Method.
Marking-scheme solution
National Income (NNP$\displaystyle _{FC}$) = (ii) + (i) + (iii) + (v) + (iv) - (vi) – {(vii) - (viii)} + (ix)
= $\displaystyle 200$ + $\displaystyle 110$ + $\displaystyle 30$ + $\displaystyle 20$ + (-$\displaystyle 40$) - $\displaystyle 15$ - $\displaystyle 60$ + $\displaystyle 15$ + (-$\displaystyle 40$)
= ₹ $\displaystyle 220$ crore
Three precautions to be taken while estimating National Income by Expenditure Method are:
Expenditure on intermediate goods should not be included.
Expenditure on purchase of second-hand goods should not be included.
Expenditure on purchase of financial instruments (shares, bonds, debentures etc.) should not be included.
More from National Income Accounting
- To arrive at the value of Net Value Added at Market Price (NVA MP ), must be to/from Gross Value Added at…2025 · asked 3×
- Income generated from Aircrafts of Air India operating between Canada and England would be added to the…2026 · asked 3×
- Read the following passage carefully: The domestic product measures the value of all goods and services…2026 · asked 3×
- Read the following statements carefully: Statement I: Positive externalities refer to the benefits a firm/an…2026 · asked 3×
- Following are the steps to measure National Income (NNP FC ) by Value Added method: (i) Calculate Domestic…2026 · asked 3×
- Read the following Flow chart carefully and choose the correct option:2026 · asked 3×
- Read the following statements carefully: Statement 1: Final goods are those goods which normally lose their…2026 · asked 3×
- (i) Suppose, there are only three firms in a hypothetical economy, viz. A, B and C. During a given period of…2025 · asked 3×
CBSE Class 12 Economics past-paper question from the 2024board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.