Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: National Income Accounting

Question:

If NDPFC is ₹2500 and Net Factor Income to Abroad is ₹500. What is NNPFC?

Options:

₹1000

₹2000

₹1500

₹3000

Correct Answer:

₹2000

Explanation:

The correct answer is option 2: ₹2000

NNPFC =  NDPFC + Net factor income FROM abroad.

NDPFC = ₹2500

We are given net factor income TO (and not FROM) abroad.

Thus, Net factor income FROM abroad = -500 (negative value as it represents outflow of income)

NNPFC = NDPFC – Net factor income to abroad
          = ₹2,500 – ₹500

          = ₹2000