For an economy (in Rs crore): GNP at market prices = 5,400; depreciation = 400; other current transfers from the rest of the world = 150; net indirect taxes = 300. What is the National Disposable Income?
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → Rs 5,150 crore
Given:
GNP at market prices = 5,400
Depreciation = 400
Other current transfers from the rest of the world = 150
Net indirect taxes = 300
National Disposable Income = NNP at market prices + Other current transfers from the rest of the world.
NNP at market prices = 5,400 − 400 = 5,000
National Disposable Income = 5,000 + 150 = Rs 5,150 crore
NDI is built on NNP at market prices, so net indirect taxes are not deducted. Deducting them gives the wrong Rs 4,850 crore.
NCERT (2026-27): “National Disposable Income and Private Income … National Disposable Income = Net National Product at market prices + Other current transfers from the rest of the world The idea behind National Disposable Income is that it gives an idea of what is the maximum amount of goods and services the domestic economy has at its disposal. Current transfers from the rest of the world include items such as gifts, aids, etc.” Glossary: “Net National Product (NNP) (at market price) – GNP – depreciation.” |