Value Added Method

Q.

Differentiate between formal sector and informal sector.

Q.

What is the difference between opening stock and closing stock?

Q.

Differentiate between final and intermediate goods. (4 points)

Q.

On the basis of the following data about an economy which consists of only two firms, find out the value added by firm A. $\begin{array}{cc}\text{Items}& \left(\text{in lakh}\right)\\ \text{Sales by firm A}& 100\\ \text{Purchases from firm B by firm A}& 40\\ \text{Purchases from firm A by firm B}& 60\\ \text{Sales by firm B}& 200\\ \text{Closing stock of firm A}& 20\\ \text{Closing stock of firm B}& 35\\ \text{Opening stock of firm A}& 25\\ \text{Opening stock of firm B}& 45\end{array}$

1. 35

2. 55

3. 195

4. 85

Q.

Calculate intermediate consumption from the following data:

$\begin{array}{cc}\text{Value of output}& 400\\ \text{Net value added at factor cost}& 160\\ \text{Depreciation}& 40\\ \text{Subsidy}& 10\\ \text{Sales tax}& 30\end{array}$

Q.

What is marketable surplus?

Q.

Name some notable economists who estimated India's Per Capita Income during the colonial period.

Q.

Precautions of value added method

Q.

Calculate Gross value added at factor cost:
$$\begin{array}{cc}\text{(a) Sales}& 800\\ \text{(b) Opening Stock}& 40\\ \text{(c) Closing Stock}& 30\\ \text{(d) Subsidies}& 50\\ \text{(e) Purchase of intermediate product}& 400\\ \text{(f) Purchase of machinery}& 200\end{array}$$

Q.

What is the difference between return to scale and return to variable factor?

Q.

What is the relation between Income and expenditure?

Q.

Calculate the total value added from the following data. Ignore units. $\begin{array}{cc}\text{Value of output in primary sector}& 800\\ \text{Value of output in secondary sector}& 200\\ \text{Value of output in tertiary sector}& 300\\ \text{Value of raw materials purchased by primary sector}& 400\\ \text{Value of raw materials purchased by secondary sector}& 100\\ \text{Value of raw materials purchased by tertiary sector}& 50\end{array}$

1. 750

2. 1, 300

3. 800

4. 400

Q.

Distinguish between intermediate products and final products. Give examples.

Q.

The stock of unsold finished or unfinished goods, and unused raw materials and intermediate goods that a firm carries from one year to another is called ___.

Q.

The problem of double counting can be avoided by using:

1. Value added method

2. Both (a) and (b)

3. Neither (a) nor (b)

4. Final output method

Q.

Are the concepts of demand for domestic goods and domestic demand for goods the same?

Q.

A car running between Delhi and Agra at a speed of 120 km/h includes:

1. Only stock variables

2. Only flow variables

3. Both a stock and a flow variable

4. None of these

Q.

Quantity measured at a particular point of time is called :

1. Stock variable

2. Fixed inventory

3. None of these

4. Flow variable

Q.

Which of the following is a stock variable ?

1. Interest on capital

2. Expenditure of money

3. None of these

4. Distance between Delhi and Manali

Q.

'Income of the family' is an example of which variable?

1. Flow

2. Both stock and flow

3. Neither stock nor flow

4. Stock

Q.

Which of the following is not included in inventory investment?

1. Change in stock of raw material

2. Change in sales during the year

3. Change in stock of finished goods

4. Change in stock of semi-finished goods

Q.

Differences between closing stock and opening stock during an accounting year are known as:

1. Change in stock

2. None of these

3. Increase in stock

4. Decrease in stock

Q.

A quantity measured per unit of time period is known as :

1. Stock variable

2. Flow variable

3. Inventory

4. None of these

Q.

Which of the following is not a flow variable?

1. Leakage of water from the overhead tank

2. Supply of money in a country

3. Income

4. Capital formation

Q.

Is tally software a fixed asset?

Q.

Which of the following categories does a change in inventory belong to?

1. Stock variable

2. Flow variable

3. Constant

4. None of the above

Q.

In the value added method, we subtract the intermediate consumption from total value to avoid the problem of:

1. Indirect tax miscalculation

2. Including factor cost

3. Exclusion of incomes from abroad

4. Double counting

Q.

What are the three main central problems of an economy?

Q.

Household inventory is:

1. Not included in national income

2. A stock concept

3. Both (a) and (b)

4. None of these

Q.

Some infrastructural facilities have a direct impact on production of goods and services while others give indirect support by building the social sector of the economy. Using above information, differentiate between social and economic infrastructure.