Question

Mention the situation in which following equations will hold true:
(i) National Income $=$ Domestic Income
(ii) $GD{P}_{FC}>GD{P}_{MP}$
(iii) $NN{P}_{FC}<ND{P}_{FC}$
(iv) $GD{P}_{FC}=GD{P}_{MP}$
(v) Domestic Income is greater than National Income.

Answer 1

(i) National Income = Domestic Income: this situation will be seen when There will be no Net factor income from abroad.
(ii) GDP(at FC) >GDP(at MP) : This situation will be seen when Subsidies will be more than indirect tax.
(iii) NNP(at FC) <NDP(at FC): This situation will be seen when net factor income from abroad is negative.
(iv) GDP(at FC) =GDP(at MP) : This situation will be seen when net indirect tax is zero.
(v) Domestic Income is greater than National Income: This situation will be seen when net factor income from abroad is negative.