Ques on 1

Plot India's GNP at factor cost during 1985-2000 and 2001 -2012 and comment on its trend.

Years GNP at Factor

Cost
1985-86 2612.88 GNP at Factor Cost (1985 - 2000)
1986-87 2911.19
20000
1987-88 3294.49 18000
1988-89 3917.99 16000
14000
1989-90 4508.09
12000
1990-91 5242.68 10000
1991-92 6034.51 8000
1992-93 6920.78 6000
4000
1993-94 8058.81 2000
1994-95 9423.02 0
1995-96 11051.02
1996-97 12887.06
1997-98 14344.08 GNP at Factor Cost
1998-99 16537.71
1999-00 18427.74

GNP at Factor
Years GNP at Factor Cost (2001 - 2014)
Cost
2001-02 21551.92 90000
2002-03 23717.74 80000
70000
2003-04 26051.11 60000
2004-05 29490.89 50000
2005-06 33643.87 40000
30000
2006-07 39200.42 20000
2007-08 45615.74 10000
2008-09 52706.44 0
2009-10 60709.03
2010-11 71670.53
2011-12 83148.61 GNP at Factor Cost
2012-13 54166.59
2013-14 56738.57

Inference:
We know that the GNP final goods and services at market price produced within the
domes c territory of the country in an accoun ng year including net factor income from
abroad minus net indirect taxes. The data suggests that from the year 1985 the GNP is
increasing till the year 2012, after which there is a decline in the GNP at factor cost from the
year 2011 to 2014.
Question 2
Compute the growth rate of India's Nominal and Real GNP for the Period 2015-2016.
Tabulate and comment on it.

GNP Annual Growth

Year Inflation
Nominal GNP Real GNP Normal GNP Real GNP
15.0
2007-08 49665.78 42337.7 0 0
9.0 9.8 9.1
2008-09 55971.4 43909.7 12.6961058 3.71295735 10.0
6.6
2009-10 64398.27 47630.9 15.0556713 8.47476387
5.0
2010-11 77023.08 52277.4 19.6042689 9.75520093 0.0
2011-12 89328.92 55866.8 15.9768215 6.86614232 0.0
2007-08 2008-09 2009-10 2010-11 2011-12

Annual Growth Inflation

Annual Growth Rate Chart

25

20

15

10

0
2007-08 2008-09 2009-10 2010-11 2011-12

Annual Growth Normal GNP Annual Growth Real GNP

Inference:
It is clear that nominal GNP usually exceeds real GNP because of infla on. Greater the
difference between nominal and real GNP, greater is the infla on. Here also we see that in
the financial year of 2009 to 2010 was the least inflated period between 2007 to 2012.
Whereas in 2010-11 had a huge infla on.
Ques on 3
Plot India's GDP at Market Price at Current and Constant Price over the Period 2001-2012.

GDP at Market Price

Year Current
Constant Prices
Prices
2001-02 23558.45 26618.19
2002-03 25363.27 27662.98
2003-04 28415.03 29834.97
2004-05 32422.09 32198.34
2005-06 36933.69 35183.48
2006-07 42947.06 38419.74
2007-08 49870.90 42337.68
2008-09 56300.63 43909.66
2009-10 64778.27 47630.90
2010-11 77841.15 52277.39
2011-12 90097.22 55866.83

GDP at Market Prices

100000.00
90000.00
80000.00
70000.00
60000.00
50000.00
40000.00
30000.00
20000.00
10000.00
0.00

Current Prices Constant Prices

Inference:
This helps us compare the increase in the current prices as it is higher than the constant
prices. The current prices are nominal and as those indicate a par cular part od the me.
The current prices on the other hand is corrected for the changes in the price as it varies.
Ques on 4
Using GNP Deflator find out real GNP from nominal GNP for years 1995,2007,2011 and
2015.

Year Wholesale Price Index GNP Deflator Nominal GNP(In Crores) Real GNP(In Crores)
1995 121.60 1.22 1105102 908800.99
2007 116.60 1.17 4561574 3912156.09
2011 100.00 1.00 8276665 8276665.00
2015 109.70 1.10

Real GNP vs Nominal GNP

9000000
8000000
7000000
6000000
5000000
4000000
3000000
2000000
1000000
0
1995 2007 2011 2015

Nominal GNP(In Crores) Real GNP(In Crores)

Inference:
The objec ve to find the real GNP can be achieved by using the GNP deflator which can be
derived by dividing the wholesale price index by 100. With the GNP deflator and the
nominal GNP we can get real GNP, by dividing nominal GNP by the GNP deflator.
Here nominal GNP is more than the real GNP because of the infla on component.
 0

-40
-20
20
40
60
80
100

-50
50
100
150
200
50

-200
-150
-100
0

-50
100
1975-76 1975-76
1975-76
1976-77 1976-77
1976-77
1977-78 1977-78
Ques on 5

1977-78
1978-79 1978-79
1978-79
1979-80 1979-80
1979-80
1980-81 1980-81
1980-81
1981-82 1981-82
1981-82
1982-83 1982-83
1982-83
1983-84 1983-84
1983-84
1984-85 1984-85
1984-85
1985-86 1985-86
1985-86
1986-87 1986-87
1986-87
1987-88 1987-88
1987-88
1988-89 1988-89
1988-89
1989-90 1989-90
1989-90
1991-92 1991-92
1991-92
1992-93 1992-93

Services Constant
Manufacturing Constant
Agriculture Constant
1992-93
1993-94 1993-94
1993-94
1994-95 1994-95
1994-95
1995-96 1995-96
1995-96

Service Sector
1996-97 1996-97
1996-97
Agricultural Sector

1997-98 1997-98
1997-98
Manufacturing Sector

1998-99 1998-99 1998-99

1999-00 1999-00
Service in GDP (Factor Cost) for the period 1975-90 and 1991-05.

1999-00

Services Current
2000-01 2000-01 2000-01
Agriculture Current

2001-02 2001-02 2001-02

Manufacturing Current
2002-03 2002-03 2002-03
2003-04 2003-04 2003-04
2004-05 2004-05 2004-05
2006-07 2006-07 2006-07
2007-08 2007-08 2007-08
2008-09 2008-09 2008-09
Find out and Comment on the Sector Contribu on of Agriculture, Manufacturing and

2009-10 2009-10 2009-10

2010-11 2010-11 2010-11
2011-12 2011-12 2011-12
2012-13 2012-13 2012-13
 Sectoral Contributions in GDP
250
200
150
100
50
0
-50
1975-76
1976-77
1977-78
1978-79
1979-80
1980-81
1981-82
1982-83
1983-84
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
-100
-150
-200

Agriculture Constant Agriculture Current Manufacturing Constant

Manufacturing Current Services Constant Services Current

Inference:
The contribu ons of the sectors (Agriculture, Manufacturing and Service) are separately
and combined viewed in detail. The agriculture sector has seen a huge dip in the 1970’s
and in the dura on a er 2004 ll 2014 there has been a posi ve constant and current
price. In contrast the manufacturing sector has had a boom in the constant prices
compared to the current prices in the 1970’s and a er 1980’s ll the 1990 is has been
posi ve with some decrease. Except the period of 1991 to 1992 the prices have been
posi ve. The service sector compared to both the other sectors have been doing well in
terms of the both constant and current prices.
Ques on 6
Bring out the saving to GDP ra o for the Same period.

Savings,GDP Ratio
0.4
0.35
0.3
GDP Ratio

0.25
0.2
0.15
0.1
0.05
0

Years

GDP Ratio

Inference:
This shows that there has been a constant fluctua on between the savings and the GDP of
our country. 2007-2008 was the period when savings and the GDP has seen the higher
ra o. It has seen a reduced ra o a er this period but s ll greater.
Ques on 7
Comment on Saving to Investment ra o in India for the Same Period.

Savings, Investment Ratio

1.2
1
0.8
0.6
0.4
0.2
0
1975-76
1976-77
1977-78
1978-79
1979-80
1980-81
1981-82
1982-83
1983-84
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
Investment Ratio

Inference:
The savings and investments might have some ups and downs as they also depend on the
GDP. The ra o is below 1 as it represents the equal level of both the savings and investment
and some mes more than 1 as one component is more than the other.