Find GDPFC from the following data:
| GNPMP | 700 |
| Consumption of fixed capital | 40 |
| Factor income from abroad | 300 |
| Net indirect taxes | 50 |
| Factor income paid abroad | 100 |
Answer & explanation
Correct answer: option 4
The correct answer is option 4: 450
GNPMP=GDPMP+ NFIA
GDPMP = GNPMP - NFIA
= 700 - (300-100)
= 500
GDPFC = GDPMP - NIT
= 500-50
= 450
Alternatively,
GDPFC = GDPMP - NIT
GDPFC =(GNPMP - NFIA) - NIT
GDPFC = 700 - (300 - 100) - 50
GDPFC = 700 - 200 - 50
GDPFC = 450
NFIA = Factor income from abroad - Factor income paid abroad