Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: National Income Accounting

Question:

Calculate the factor income from Abroad from the following :

    (₹ in crore)
(a) NNP at market price 550
(b) Net Indirect taxes 30
(c)p NVA at factor cost 540
(d) Factor income to Abroad 50
Options:

₹70 Crore

₹90 Crore

₹30 Crore

₹50 Crore

Correct Answer:

₹30 Crore

Explanation:

The correct answer is option (3) : ₹30 Crore

Net value added at factor cost is the sum total of all the factor payments. It is the result of factors of production that residents get in the form of wages, salaries, dividends, etc.

Thus,

NNP at FC= NVA at FC + NFIA

NNP at MP- Net Indirect Taxes= NVA at FC + Factor income from Abroad - Factor income to Abroad

Factor income from Abroad= NNP at MP- Net Indirect Taxes -NVA at FC + Factor income to Abroad

                                            = 550 - 30 - 540 + 50

                                            = 30 Crores