Unit-2 National income accounting (numerical)

 In terms of  market price : 

1. Gross Domestic Product at market price (GDP)

GDPmp= C+I+G+(x-m)

Where :

        C= Private consumption expenditure

        I= Domestic Investment

        G= Government expenditure

        x= value of Export

        m= value of Import 

  2. Net domestic product at mp (NDPmp)

            NDPmp= GDPmp-Depreciation

 3. GDPmp= p1Q1+P2Q2+P3Q3+....................+PnQn

     where , 

P= price & Q= quantity

4. National Domestic Product at mp (NDPmp)

 NDPmp= GDPmp+Net factor income from abroad

        5. Net National Product at mp (NNPmp)

            NNPmp= NDPmp-depreciation

In terms of Factor cost method : 

GDPfc= GDPmp-Net indirect tax 

        where,

                Net indirect tax= Indirect tax - subsidies

               NDPfc= GDPfc-depreciation

              GNPfc = NDPfc+ net factor income from abroad

               NNPfc= GNPfc-depreciation  

                or,

              NNPfc= NDPfc+ net factor income from abroad

                or,

            (NI)   NNPfc= GDPmp-depreciation-Net indirect tax

              NI= wages + salary + interest + Profit + rent + Net factor income from abroad + undistributed profit

  Personal income (PI) = National income- undistributed corporate profit-Social security contribution + Transfer payment- corporate income

         Disposable income (DI) = PI-Personal direct taxes

         Personal saving = DI - expenditure 

          GDP deflector = Nominal GDP/Real GDP *100

             

Solution of BBS Second year