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The given statement is defended The subsidy is a transfer payment. The subsidy is the financial assistance provided by the government to producers to fulfill its social welfare objectives. The government does not get anything in consideration for the same.…
No, It is an intermediate expenditure for the firm because it involves the purchase of services by one production unit (firm) from another production unit (lawyer). So, it is deducted from the value of the output of the firm to…
False, GNP would be ₹ 240 Solution:- GNP Deflator = Nominal GNP/Real GNP × 100 GNP Deflator = 1,200/500 × 100 GNP Deflator = ₹ 240
False, With increase in real GDP, welfare of people may not rise if there is inequality in the distribution of GDP or due to negative externalities. Explanation:- Negative externalities such as air and sound pollution results in health hazards. If…
False, National Income is sum total of all factor incomes earned by normal residents, anywhere in the world. transfer income does not add the current flow of goods and services, thus are not included in the national income.
True, As electricity is used for further production, it is a part of the intermediate cost.
True, Expenditure on such own account production, i.e., production for self-consumption will be included in the National Income since these are productive services. Explanation:- If market value of the production for self-consumption is ascertained. It will be included in the…
False, Double Counting can be avoided either by taking the value of final output or by taking value added by each producing unit. Explanation:- Let’s understand with an example: The farmer produces goods and sale it to dealer for ₹…
False, Gross Domestic Capital Formation can be less than Gross Fixed Capital Formation if a change in stock is negative, i.e., when opening stock is more than closing stock. Explanation:- Gross Domestic Capital Formation = Gross Fixed Capital Formation +…
True, Such goods contribute to the current output and their imputed value will be included in national income. Explanation:- in simple words, the market value of goods produced for self-consumption can be ascertained with available data. Thus it adds to…