Question

The net domestic product at market price of an economy is ₹ 4, 500 crores. The capital stock is worth ₹ 4, 000 crores and it depcreciates at the rate of `10%` per annum. Indirect taxes amount to ₹ 150 crores , subsidies amout to ₹ 20 crores , factor income from the rest of the world is ₹ 400 crores and to rest of the world is ₹ 600 crores . Find out the gross national product at factor cost.

Answer 1

Correct Answer - Gross National Product at Factor Cost `(GNP_(FC))` = ₹ 4, 570 crores
Gross National Product at Factor Cost `(GNP_(FC))`
= Net Domestic Product at Market Price + Depreciation - Net Indirect Taxes + Net Factor income from abroad
= 4, 500 + `10%` of 4, 000 - (150 - 20) + (400 - 600)
=` 4, 500 + 400 - 130 - 200` = ₹ 4, 570 crores