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Question

Calculate Net National Product at Factor Cost and Gross National Disposable Income from the following:

(Rs in crores)(i) Net current transfers to10the rest of the world(ii) Savings of non-departmental60enterprises(iii) Net indirect tax90(iv) Income from property and enterpreneurship80 accruing to the government administrative departments(v) Consumption of fixed capital70(vi) Personal tax100(vii) Corporation tax40(viii) National debt interest30(ix) Current transfer payments by Government50(x) Retained earnings of private corporate sector10(xi) Personal disposable income1,100

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Solution

(a) Net National Product at Factor Cost

NNPFC = Personal disposable income + Personal tax + Corporation tax + Retained earnings of private corporate sector - National debt interest - Current transfer payments by the government + Net current transfers to the rest of the world + Income from property and entrepreneurship accuring to government administrative departments + Savings of non-departmental enterprise

= (xi)+ (vi)+ (vii)+ (x) - (viii)- (ix) +(i)+ (iv)+ (ii)

= 1,100+100+40+10-30- 50+10+80+60

=1,400-80 = 1,320 crores

(b) Gross National Disposable Income

GNDI = NNPFC+ Consumption of fixed capital + Net industry tax - Net current transfer to the rest of the world

= NNPFC + (v) + (iii) - (i)

=1,320+70+90-10 = 1,480-10 = 1,470 crores


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