Methods of Calculating National

income
QUestions-Past 5 years
CBSE
with
Answers or Reference to the Text for
Answers)
alculate Net Domestic Product at Factor Cost:
Items

Private final consumption expenditure in crore)

Government final consumption expenditure 8,000
(ii) Exports 1,000
(iv) Imports 70
()Consumption of fixed capital 120
(vi) Gross domestic fixed capital formation 60

(vil) Change in stock 500

Factor income to abroad 100
(vii)
ix) Factor income from abroad 40
x)Indirect taxes 90
(xi) Subsidies 700
(xii) Net current transfers to abroad 50

Page 456, 457] 30

2. Calculate National Income [CBSE Delhi 2017]
Items
) Net factor income to abroad in crore)
(i) Net indirect taxes 50
800
(ii) Net current transfers from rest of the
world
(iv) Net imports 100
200
(v) Private final consumption expenditure
5,000
vi) Government final consumption expenditure
(vi) Gross domestic capital formation 3,000
1,000
vii) Consumption of fixed capital
150
ix) Change in stock
x) Mixed income 50
4,000
(xi) Scholarship to students
80
[Page 457]
3. [CBSE Delhi 2017]
Calculate Net National Product at Market Price:
Items
T in crore)
0 Gross domestic fixed
capital formation 400
0) Private final
consumption expenditure 8,000
Government final consumption expenditure 3,000
(iv) Change in stock 50
(vConsumption of fixed capital
vi)
40
Net
indirect taxes 100
(vi) Net exports
(VI) Net factor 60
income to abroad 80
125
t o r y Macroeconomics

x) Net current transfers from abroad 100

(x)Dividend 100
[Page 457. 458] [CBSE Delhi 2017
How will you treat the following while estimating domestic product of a country? Give ras.
reasons for
your answer
countries.
(a) Profits earned by branches of country's bank in other
independence day.
given by an employer to his employees
on
(b) Gifts

c) Purchase of goods by foreign tourists. [CBSE Delhi 2017

[Page 471]
national income by
the precautions that should be taken while estimating
exnDend:,
5. Explain diture
method. CBSE (AI) 2017
Or
What precautions should be taken while estimating national income by expenditure methods
od?
Explain. [CBSE (F) 2017
[Page 106. 1071
6. Explain the precautions that are taken while estimating
national income by value added method
[CBSE (A) 2017

What precautions should be taken while estimating national income by value added method? Explain

[Page 94,95] CBSE (F) 2017

Calculate National Income:

tems in crore)
() Compensation of employees 2,000
400
i) Rent
900
Gii) Profit
100
(iv) Dividend
S00
(v) Interest
7,000
(vi) Mixed income of self-employed
50
(vii) Net factor income to abroad
60
(vii) Net exports
300
(ix) Net indirect taxes
150
)Depreciation
30
(xi) Net current transfers to abroad
CBSE (A) 2017
Page 449, 450]
8 Calculate the Net National Product at Market Price:
i n crore)
Items
8,000
) Mixed income of self-employed
200
i) Depreciation
1,000
(in) Profit
600
(iv) Rent
700
(v) Interest
3,000

(vi) Compensation of employees

5
 Methods of Calculating National Income

indirect
taxes
Net 500
(vi) income to abroad
ii) Net factor 60
(ix) Net exports

to abroad
50
transfers
current
)Net 20
Page 450) ICBSE (AI) 20171
drulate the Gross National Product at Market Price:
Items in crore)
Compensation of employees 2,500
(i) Profit 700
income of self-employed
G) Mixed 7,500
final consumption expenditure
(iv) Government 3,000
(V) Rent 400
vi) Interest 350
(vi) Net factor income from abroad 50
Net current transfers to abroad 100
(vii)
(ix) Net indirect taxes 150
) Depreciation 70
xi) Net exports 40
Page 450, 451] CBSE (A1) 2017]
10.Will the following be included in the domestic product of India? Give reasons for your answer.
(a) Profits earned by foreign companies in India.
(b) Salaries of Indians working in the Russian Embassy in India.
(c) Profits earned by a branch of State Bank of India in Japan. CBSE (Al) 2017]
Page 472]
11 Will the following be included in the national income of India? Give reasons for your answer.
(a) Financial assistance to flood victims.
6) Profits earned by the branches of a foreign bank in India.
() Salaries of indians working in the American Embassy in India. [CBSE (AI) 2017]
Page 472]
2Explain 'mixed income of self-employed' and give an example. [CBSE (F) 2017]
Page 100]
3. Calculate National Income:
Items in crore)
) Profit 1,000
() Mixed income of self-employed 15,000
(i) Dividends 200
(iv) Interest 400
()Compensation of employees 7,000
(Vi) Net factor income 100
to abroad
(Vin)
Consumption of fixed capital 400
(vii) Net exports 200
(ix) Net indirect 800
taxes

127
Introductory M a c r o e c o n o m i c s

transfers to rest of the world

)Netcurrent
(xi) Rent 40
[Page 451] 500
14 Calculate Net National
Product at Market Price: CBSE F) 20
Items in thousand crore
() Compensation of employees
i) Mixed income of self-employed 250
(Gii) Profit 600
(v) Rent 80
() Interest 30
(vi) Net factor income to abroad 40
(Vii) Net exports 10
15
(Vvii) Consumption of fixed capital
20
(ix) Net indirect taxes
10
(x) Net current transfers to abroad
8
Page 451, 452
15. Calculate National Income CBSE (F) 2017
Items
() Compensation of employees in crore)
(i) Profit 2,000
ii) Rent 800
(iv) Interest 300
(v) Mixed income of self-employed 250
(vi) Net current transfers to abroad 7,000
(vii) Net exports 200
(vii) Net indirect taxes 100
ix) Net factor income to abroad 1,500
()Consumption of fixed capital 60
Page 452] 120
16. Calculate (a) Operating Surplus, and
(b) Domestic Income: CBSE (F) 2017
Items
(i) Compensation of employees
Gi) Rent and interest
in crore)
2,000
Gii) Indirect taxes
800
(iv) Corporation tax
120
(v) Consumption of fixed capital 460
(vi) Subsidies
100
(vi) Dividend
20
(vii) Undistributed profits
940
(ix) Net factor income to abroad
300
(x) Mixed income
150
Page 452]
200
128 CBSE 2018
 double counting in the
blem of doubl
proble Methods of
:7
D e f i n e

to
the
rectthe problem of double counting. Calculating Nationai Inrome
estimation of
Page 95, 96]
national income. Discuss two
CBSE 2019 approaches
Given
Given the following
the
data,
data, find
find the
th
missing value of
(58/1/1), 2020
(58/3/1)
Mixed self-employed'
Income of Government Final
tems Consumption Expenditure' and
) National income

G) Gross domestic capital formation in crore)

Government final consumption expenditure 71,000
i Mixed income of self-employed 10,000
)Netfactor income from abroad

(vi) Net indirect taxes

(vii) Profits
1,000
2,000
(vii) Wages and salaries 1,200
(ix) Net exports
15,000
(Private final consumption expenditure 5,000
xi) Consumption of fixed capital 40,000
(xi) Operating surplus 3,000
Page 465] 30,000
19, Given the following data, find the [CBSE 2019 (58/1/1)1
missing values of 'Private Final
'Operating Surplus'. Consumption Expenditure' and
Items
) National income Rin crore)
(i) Net indirect taxes 50,000
1,000
i) Private final consumption
expenditure ?
(iv) Gros domestic capital formation
17,000
(v) Profits
1,000
(Vi) Government final consumption expenditure 12,500
(vii) Wages and salaries 20,000
(vii) Consumption of fixed capital 700
ix) Mixed income of self-employed 13,000

)Operating surplus ?

(xi) Net factor income from abroad 500

xii) Net exports 2,000
CBSE 2019 (58/1/2)1
Page 465, 466)
ven the following data, find the missing values of Gross Domestic Capital Formation' and Wages
and Salaries.
in crore)
Items
3,500
) Mixed income of self-employed 300
) Net indirect taxes
(01) Wages and salaries 14,000
Government final consumption expenditure 3,000

v)Net exports 300

(Vi) Consumption of fixed capital 129

 tory Mocroeconon

(vu) Net factor income trom

abroad
(vii) Operating surplus 700
(x) National income 12.000
(x)Profits 30,000
(x) Gross domestic capital formation 500
xn) Private final consumption expenditure

Page 466 467) 11.000

22 Define the following
CBSE 2019 (58/1/31
a)Value addition
(b) Income from property and entrepreneurship.
Page 92 99. 100
CBSE 2019 (58/221
22 Given the following data. find the values of 'Gross Domestic Capital Formation' and
Operarin.
tem rating Surplu
in crore
0National income
)Wages and salaries 22.100
)Private final consumption expenditure 12.000
v) Net indirect taxes 7,200
(v)Gross domestic capital formation 700
(vi) Depreciation
(vin) Government final consumption expenditure 500
(Vi) Mixed income of self-employed 6.100
4.800
x)Operatingsurplus
(x)Netexports 3,400
(x)Rent
1200
(xi)Net factor income from abroad
150
Page 467 cBSE2019 (58 2
23 Given the following data, find the values of "Government Final
Consumption Expenditure' and Mxe
income of Self-employed
items
Rin crore)
Nationalincome 7.100
Gi) Government final consumption expenditure
n) Gross domestic capital formation
1000
(v)Mixed income of self-employed
(v)Net indirect taxes 200
(vi)Net factor income from abroad 100
(vii) Private final consumption expenditure 4000

(vii) Consumption of fixed capital 300

x)Profits 120
Wages and salaries 1.500

iNetexports 500

(i) Operating surplus 3.000

1
Page 467, 468] 2019 (58 3
(C8SE
 Methods of Calculating National lincome

n the following data, find the values of 'Operating Surplus'and Gross Domestic Capital Formation':

Items in crore)
Government final consumption expenditure 2,000
() Mixed
income of self-employed 1,500
Gii) National income 12,000
iv) Net factor income from abroad 200
(v) Operating surplus
(vi) Profits 500
(vil) Private final consumption expenditure 6,000
Net indirect taxes 700
(vii)
(ix) Net exports 1,800
(x)Consumption of fixed capital 600
(xi) Gross domestic capital formation
(xii) Wages and salaries 6,000
Page 468, 469] [CBSE 2019 (58/3/2)]
25. Given the following data, find the values of 'Operating Surplus' and 'NetExports
Items in crore)
) Mixed income of self-employed 700
150
i) Net factor income from abroad
2,200
(ii) Private final consumption expenditure
iv) Profits
200
150
(v) Net indirect taxes
(vi) National income 5,000
1,100
(vi) Gross domestic capital formation
(vii) Wages and salaries 2,200

ix) Net exports

Government final consumption expenditure 1,300
200
(xi) Consumption of fixed capital
(xii) Operating surplus
[CBSE 2019 (58/3/3)
[Page 469
abroad'. How is it different from 'net exports'?
26 (a) Define 'net factor income from
Calculate the value of "Rent" from
the following data:
(b)
R in crore)
Items
at market price 18,000
() Gross domestic product
7,000
i) Mixed income of self-employed
250
Gi) Subsidies
800
Giv) Interest
(v)Rent
975
(vi) Profit
6,000
(vii) Compensation of employees
1,000
(vii) Consumption of fixed capital
(ix) Indirect tax 2,000
Page 105, 121, 453 CBSE 2019 (58/4/1)

131
ntroductoryMacroeconomcs

from net factor

income from ahre-
oad?
different
How is it
Define net exports. data:
27 (a) "lnterest" from the following
Calculate value
of
(b) (in crore
Items
) Indirect tax
1,500
700
(i) Subsidies
1,100
(i) Profits
capital 700
(iv) Consumption of fixed
product at market price 17.500
(v) Gross domestic 9,300
of employees
vi) Compensation
(vii) Interest
3,500
(vii) Mixed income of self-employed
800
(ix) Rent
CBSE 2019 (58/4/2)
Page 105, 121, 453]
different from 'value addition'?
28. (a) Define 'value of output'. How is it
Calculate the value of "Mixed Income of Self-employed"
from the following data
(b)
R in crore)
Items
i) Compensation of employees 17,300
(i) Interest 1,200
(ii) Consumption of fixed capital 1,100
(iv) Mixed income of self-employed
(v) Subsidies 750
(vi) Gross domestic product at market price 27,500
(vii) Indirect taxes 2,100
(viii) Profits 1,800
(1x) Rent 2,000
Page 92, 453, 454] CBSE 2019 (58/4/3)]
29. Distinguish between net factor income from abroad and net exports. CBSE 2019 (58/5/1))
[Page 105, 121]
30. What is meant by the problem of double counting? Discuss briefly the two approaches to avoid this
problem.
CBSE 2019 (58/5/1)
[Page 95, 96)
31. Given the following data, find the values of Operating Surplus' and 'Net Exports:
Items
) Wages and salaries
in crore)
2,400
i) National income
(ii) Net exports
4,200
(iv) Net factor income from abroad
200
(v)Gross domestic capital formation
1,100
(vi) Mixed income of self-employed
400
(vii) Private final consumption expenditure
2,000
(vii) Net indirect taxes
150
(ix) Operating surplus
 (x) Govement final consumption expenditure
(Ni) Comsumption of tixed capital 1,000
(Nu) Protits
100
'00
Page 469, 4701
CBSE 2019 (58D
Calculatethe value of 'Change in Stock from the following data:
Items
) Sales ( tore)
) Net value added at tactor cost (NVAFC) 400

(it) Subsidies 200

(v) Changein stock 10

() Depreciation
(vi) Intermediate consumption 40
100
IPage 445) ICBSE 2020 (58/1/101
3 Discussbrietly the three components of "lnconme trom Property
and Entrepreneurship'
Or
state the three
ICBSE 2020 (58/1/1)1
components of income from
property and
Page 99, 1001 entrepreneurship. ICBSE 2020 (58/4/1)1
34. Distingtuish between value of output' and 'value added
IPage 92 CBSE 2020 (58/2/1)1
35 Calculate Gross Value Added at Market Price
(GVAM) from the tollowing data:
tems
(in crore)
) Depreciation
20
(i) Domestic sales
200
(ii) Change in stock
-)10
(IV) Exports
10
(V) Single use producer goods
120
(vi) Net indirect taxes
20

Page 445, 446] ICBSE 2020 (58/3/1)1

36. Define income from property and entrepreneurship. ICBSE 2020 (58/3/21
IPage 99, 100]
37. Domestic services (Household services) pertormed by a woman are not considered as an
economy
activity
Defend or refute the given statement with valid reason.
CBSE 2020 (58/4/11
Page 110
38. Calculate Net Value Added at Factor Cost (NVA) from the following data:
Items ( in crore)
)Values of output 800
(i) Intermediate consumption 200
i) Indirect taxes
(iv) Depreciation 0

133
ntroductory Macroeconomics
(v)Subsidies
(vi) Purchase of machinery 50
50
Page 446 (CBSE 2020 (58/4/11
39 Which of the following is not a 'factor payment'? (Choose the correct
(a) Free uniform to defence personnel CBSE 2020alternati
(58/5/1
(b) Salaries to the Members of Parliament
(c) Rent paid to the owner of a building
(d) Scholarship given to the students
(d)
40. Combined factor income, which can't be separated into various factor income componen.
as
(Fill up the blank with
correctanswe
[mixed income of self-employed] [CBSE 2020 (58/5/1)
41. Net Domestic Fixed Capital Formation + Change in Stock =
.

(Fill up the blank with

correctanswer
Net domestic capital formation] [CBSE 2020 (58/5/1)]
42. Calculate Gross Value Added at Market Price:
Items
in crore)
() Depreciation
20
(ii) Domestic sales
200
(ii) Change in stocks
(iv) Exports H10
10
(v) Single use producer goods
120
CBSE 2020 (58/5/1)]
[Page 446]
43. Calculate Net Value Added at Factor Cost from the following data:
Items
in crore)
(i) Durable producer goods (with a life span of 10 years) 10
(i) Single use producer goods 5
(ii) Sales
20
(iv) Unsold goods (Stock) 2
(v) Goods and Services tax (GST)
CBSE 2020 (58/5/2)]
Page 446, 447]
44. Rent + Interest + Profit =
(Fill up the blank with correct answe
CBSE 2020 (58/5/3)
Operating surplus]
45. Calculate Net Domestic Product at Factor Cost:
Items i n crore))
) Interest 700
(ii) Compensation of employees 3,000

134
 Metethods of Cakuictinc Votond ncoime
Net indirect taxes
(ii)
500
Rent and Profit
(iv)
700
()Transfer payments by government 10
CBSE 2020 (58/5/3))
Page 454]

NCERT Questions (With Hints to Answers)

What
1. What is difference between planned
is the dift
and unplanned
relation between change in inventories and value added ofinventory
a firm.
accumulation? Write down the
Hint: Planned inventory accumulation refers
to desired
nroducers with a view to exploiting potential demand for inventory stock. This is maintained by the
his product. Otherwise, the
suffer the loss of unfulfilled demand. Unplanned producer might
stock. It arises because demand for the inventory accumulation refers to undesired inventory
product turns out to be lower than
unplanned inventory accumulation leads to losses. expected. Accordingly,
Value Added =Sales, net of intermediate costs +
Change in inventory stock (Closing inventory stock
-

Opening inventory stock)]

2. What are the four factors of
production and what are the remunerations to each of
[Hint: The four factors of production are these called?
land, labour, capital and
to each of these are called
compensation of entrepreneurship. The remunerations
interest (reward for capital) and profit employees (reward for labour), rent
(reward for land),
(reward for entrepreneurship)]
3. Why should the aggregate final
expenditure of an economy be equal to the
Explain. aggregate factor payments?
Hint: Factor payments are equal to factor
final goods and services or is saved. incomes. Income is either
Expenditure of i spent on the purchase of