Question

If factor income received from abroad is equal to factor income paid abroad, then which of the following is not a valid statement?

• A. National Income $=$ Domestic Income
• B. $ND{P}_{FC}+$ Depreciation $=GN{P}_{FC}$
• C. $ND{P}_{FC}+$ Depreciation $=GN{P}_{MP}$
• D. All are valid

Answer 1

The correct option is C $ND{P}_{FC}+$ Depreciation $=GN{P}_{MP}$

NDP(at factor cost) + Depreciation = GNP(at market price) is not a valid statement if factor income received from abroad is equal to factor income paid abroad.

Correct statement would be as follows:

NDP(at factor cost) + Depreciation+ Net indirect tax = GNP(at market price).