From the following data, calculate (i) Gross Domestic Product at Factor Cost and (ii) Factor Income to Abroad Gross Domestic Capital Formation ₹ 600

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Anurag Pathak24.20K November 21, 2023 0 Comments

From the following data, calculate (i) Gross Domestic Product at Factor Cost and (ii) Factor Income to Abroad

Particulars	₹ (in Crores)
(i) Gross Domestic Capital Formation	600
(ii) Interest	200
(iii) Gross National Product at Market Price	2,800
(iv) Rent	300
(v) Compensation of Employees	1,600
(vi) Profits	400
(vii) Dividends	150
(viii) Factor Income From Abroad	50
(ix) Change in Stock	100
(x) Net Indirect Taxes	240
(xi) Net Fixed Capital Formation	400
(xii) Net Exports	(-) 30

Ans:- GDP at FC = ₹ 2,600 Crores, Net Factor Income at Abroad = ₹ 90 Crores

score 0 · Answer 1 · 2023-11-21T05:34:36+00:00

Solution:-

Calculation of Gross Domestic Product at Factor Cost

NDP at FC = Compensation of Employees + Rent + Interest + Profits

NDP at FC = (v) + (iv) + (ii) + (vi)

NDP at FC = ₹ 1,600 + ₹ 300 + ₹ 200 + ₹ 400

NDP at FC = ₹ 2,500 Crores

GDP at FC = NDP at FC + Depreciation [Gross Domestic Capital Formation – (Net Fixed Capital Formation + Change in Stocks)]

GDP at FC = ₹ 2,500 + [(i) – ((xi) + (ix))]

GDP at FC = ₹ 2,500 + [₹ 600 – (₹ 400 + ₹ 100)]

GDP at FC = ₹ 2,600 Crores

Calculation of Factor Income to Abroad

GNP at FC = GNP at MP – Net Indirect Taxes

GNP at FC = (iii) – (x)

GNP at FC = ₹ 2,800 – ₹ 240

GNP at FC = ₹ 2,560 Crores

Net Factor Income from Abroad (Factor Income from Abroad – Factor Income to Abroad) = GNP at FC – GDP at FC

₹50 – Factor Income to Abroad = ₹ 2,560 – ₹ 2,600

Factor Income to Abroad = ₹ 2,600 – ₹ 2,560 + ₹ 50

Factor Income to Abroad = ₹ 90 Crores