Question

Calculate (a) net domestic product at factor cost and (b) gross national disposable income :

		Rs.in crores
(i)	Private final consumption expenditure	8,000
(ii)	Government final consumption expenditure	1,000
(iii)	Exports	70
(iv)	Imports	120
(v)	Consumption of fixed capital	60
(vi)	Gross domestic fixed capital formation	500
(vii)	Change in stock	100
(viii)	Factor income to abroad	40
(ix)	Factor income from abroad	90
(x)	Indirect taxes	700
(xi)	Subsidies	50
(xii)	Net current transfers to abroad	(-) 30

Answer 1

(a) NDP_FC = Private Final Consumption Expendiiure + Government final consumption expenditure + Gross domestic fixed capital formation + Change in Stock +Exports - Imports - Consumption of Fixed Capital - (Indirect Taxes - Subsidies)

= 8,000 + 1,000 + 500 + 100 + 70 -120 -60- (700-S0)

= Rs. 8,840 crores

(b) Gross National Disposable Income : NDP_FC +Net Indirect Taxes - Net current transfer to abroad + Factor income from abroad - Factor income to abroad

= 8,840 + (700 - 50) - (- 30) + 90 - 40

= Rs. 9,570 crores