Consider the following statements:
(A) Activities which contribute to the gross national product are called economic activities.
(B) To get gross national product, net earnings from foreign transactions are added to GDP.
(C) Net earnings from foreign transactions are positive when imports exceed exports in value.
(D) Those who help the main workers in an economic activity are not counted as workers.
(E) GDP is the money value of all final goods and services produced in a country in a year.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (A), (B) and (E) only
(A) Activities which contribute to the gross national product are called economic activities. — Correct. This is the meaning of economic activities.
(B) To get gross national product, net earnings from foreign transactions are added to GDP. — Correct. GDP plus the earning (plus or minus) from foreign transactions gives gross national product.
(C) Net earnings from foreign transactions are positive when imports exceed exports in value. — Incorrect. They are positive when exports exceed imports. When imports are larger, they are negative.
(D) Those who help the main workers in an economic activity are not counted as workers. — Incorrect. Workers include those who help the main workers.
(E) GDP is the money value of all final goods and services produced in a country in a year. — Correct. This is the meaning of gross domestic product.
This question uses Employment and National Income Accounting together. In National Income Accounting, the foreign earnings added to GDP are measured as net factor income from abroad.
NCERT (2026-27): “6.2 Workers and Employment … We know that the total money value of all such final goods and services produced in a country in a year is called its gross domestic product for that year. When we also consider what we pay for our imports and get from our exports we find that there is a net earning for the country which may be positive (if we have exported more in value terms than imported) or negative (if imports exceeded exports in value terms) or zero (if exports and imports were of the same value). When we add this earning (plus or minus) from foreign transactions, what we get is called the country’s gross national product for that year. Those activities which contribute to the gross national product are called economic activities. All those who are engaged in economic activities, in whatever capacity — high or low, are workers. Even if some of them temporarily abstain from work due to illness, injury or other physical disability, bad weather, festivals, social or religious functions, they are also workers. Workers also include all those who help the main workers in these activities. …” |