If net national product is given at market prices, what needs to done with indirect taxes and subsidies to get the national income of the economy?

Add, Subtract

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Add, Divide

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Subtract, Add

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Subtract, Divide

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Solution

The correct option is D Subtract, Add
If net national product is given at market prices, indirect taxes and subsidies should be subtracted and added respectively in order to get the national income of the economy.
Formula: NNP (at factor cost) = NDP(at market price)- Indirect tax + Subsidies + Net Factor Income from Abroad.

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Similar questions

(i) Rent and interest	(Rs. in crores) $6, 000$
(ii) Wages and salaries	$1, 800$
(iii) Undistributed profit	$400$
(iv) Net indirect taxes	$100$
(v) Subsidies	$20$
(vi) Corporation tax	$120$
(vii) Net factor income to abroad	$70$
(viii) Dividends	$80$
(ix) Consumption of fixed capital	$50$
(x) Social security contribution by employers	$200$
(xi) Mixed income	$1, 000$

Particulars	Rs. in crores
(i) Gross national product at market price (ii) Indirect Tax (iii) Subsidies (iv) Depreciation (v) Net Factor income from abroad	58,350 2,590 1,540 1,625 -240

R s . 65, 000

R s . 1, 20, 000

10

R s . 6, 000

R s . 1, 000

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