National Income — Set 1
Economics · राष्ट्रीय आय · Questions 1–10 of 70
The value of all final goods and services produced within the domestic territory of a country in a year is known as?
Correct Answer: D. Gross Domestic Product
Gross Domestic Product (GDP) measures the total monetary value of all final goods and services produced within a country's borders. It excludes net income from abroad and focuses strictly on geographical production. This indicator is a primary gauge of a nation's economic health.
Which organization is currently responsible for calculating the National Income in India?
Correct Answer: A. National Statistical Office
The National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation calculates India's National Income. It was formed by merging the Central Statistics Office (CSO) and the National Sample Survey Office (NSSO). The NSO releases various data including GDP and GVA estimates.
When depreciation is deducted from the Gross National Product (GNP), the remaining value is called?
Correct Answer: A. Net National Product
Net National Product (NNP) is obtained by subtracting the value of depreciation or wear and tear from GNP. NNP at factor cost is technically considered the 'National Income' of a country. It represents the actual net addition to the economy's wealth.
In the context of Indian economy, what does 'GVA' stand for?
Correct Answer: C. Gross Value Added
GVA stands for Gross Value Added, which measures the value of goods and services produced in an area, industry, or sector of an economy. It is calculated by subtracting intermediate consumption from the value of output. GVA provides a sector-wise picture of economic activity.
Which of the following is excluded while calculating the National Income of a country?
Correct Answer: C. Transfer payments
Transfer payments like old-age pensions or scholarships are excluded because they do not correspond to any current production of goods or services. Only the value of productive activities is counted to avoid overestimation. These payments are considered a redistribution of existing income.
The 'Income Method' of calculating National Income involves the summation of which of the following?
Correct Answer: C. Wages, Rent, Interest, and Profit
The Income Method sums up the primary incomes generated by individuals and enterprises for their productive services. These components represent the factors of production: labor, land, capital, and entrepreneurship. This method shows how the national income is distributed among different factors.
Which base year is currently used for the calculation of GDP at constant prices in India?
Correct Answer: A. 2011-12
India currently uses 2011-12 as the base year for calculating GDP to account for changes in the economic structure. Constant prices remove the effect of inflation, allowing for the measurement of real economic growth. The base year is periodically updated by the government.
What is the relationship between GDP at market price and GDP at factor cost?
Correct Answer: C. GDP MP = GDP FC + Indirect Taxes - Subsidies
GDP at market price includes the net impact of indirect taxes and subsidies on the cost of production. To convert factor cost to market price, we add indirect taxes and subtract subsidies. This calculation reflects the actual price paid by consumers in the market.
Which sector's contribution to the Indian National Income has seen the most significant increase since independence?
Correct Answer: A. Services
The Services sector (Tertiary sector) has grown to become the largest contributor to India's GDP, surpassing agriculture. It currently accounts for more than 50% of the total Gross Value Added. This shift signifies the structural transformation of the Indian economy.
Personal Disposable Income is calculated as?
Correct Answer: D. Personal Income - Direct Taxes
Personal Disposable Income is the amount left with individuals after paying direct taxes like income tax. It represents the actual amount available to households for consumption or saving. It is a crucial indicator of the purchasing power of the population.