Question

17 Calculate national Income by Expenditure method.

Items

Rs. In crore

i

National income

930

ii

Net domestic fixed capital formation

100

iii

Net import

(-) 20

iv

Net indirect tax

5

v

Net current transfer from abroad

15

vi

Private final consumption expenditure

600

vii

Change in stock

10

viii

Net factor income from abroad

5

ix

Net factor income to abroad

5

x

Gross domestic fixed capital formation

125​

Answer 1

Answer:

National income (income method) = Compensation of employees + Profits + Rent + Interest + Mixed income of self employed - Net factor income to abroad = 700 + 600 + 200 + 310 + 350 - 10 = 2150 crores

National income (expenditure method) = Govt. final consumption expenditure+Net domestic capital formation+Net exports+Private final consumption expenditure-Net indirect taxes-Net factor income to abroad=750 + 385 - 15 + 1100 - 60 - 10 = 2150 crores.