Question
Calculate (a) net domestic product at factor cost and (b) gross national disposable income :
| s. no. | in RS | |
| 1 | Private final consumption expenditure | 8000 |
| 2 | Government final consumption expenditure | 1000 |
| 3 | exports | 70 |
| 4 | imports | 120 |
| 5 | Consumption of fixed capital | 60 |
| 6 | Gross domestic fixed capital formation | 500 |
| 7 | change in stock | 100 |
| 8 | Factor income to abroad | 40 |
| 9 | Factor income from abroad | 90 |
| 10 | indirect taxes | 700 |
| 11 | subsidies | 50 |
| 12 | Net current transfers to abroad | (-)30 |
Solution
i. NDPFC = Private final consumption expenditure + Government final consumption
expenditure + Gross domestic fixed capital formation + Change in stock + Exports -
Imports - Consumption of fixed capital – Net indirect taxes
= 8,000 + 1,000 + 500 + 100 + 70 - 120 - 60 - (700 - 50)
= Rs 8,840 crores
ii. Gross National Disposable Income = NDPFC + Net indirect taxes - Net current transfers
to abroad + Factor income from abroad - Factor income to abroad
= 8,840 + (700 - 50) - (-30) + 90 - 40
= Rs 9,579 crores
