ASSIGNMENT- 1 ( NIA)
CREATED BY: SHUBHAM VERMA ( 9871778008)
1. Can the gross domestic product be greater than the gross national product? (1)
1) No
2) Yes
3) Never
4) Can’t say
2. State which one of the following is true. (1)
1) Rent is a factor income
2) Royalty is not a factor income
3) Tax is a factor income
4) Subsidies is a factor payment
3. National Income is a (1)
1) Hypothetical concept
2) Non economic concept
3) Stock concept
4) Flow concept
4. Money flow is the flow of (1)
1) Goods only
2) Factor payments
3) Services only
4) Goods and services only
5. What do you mean by gross investments? (1)
6. Which of the following is an example of macroeconomics? (1)
1) Price determination
2) Consumer’s equilibrium
3) Producer’s equilibrium
4) Inflation
7. Define Domestic territory of a country. (1)
8. What is meant by Real Gross Domestic Product? 1
9. What is real national income? (1)
10. Find Net National Product at Market Price. (3)
S.no.
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
11)
Contents
Personal Taxes
Wages and Salaries
Undistributed Profit
Rent
Corporate Tax
Personal Income
Interest
Net Indirect Tax
Net Factor Income from Abroad
Profit
Social Security Contribution by Employers
(Rs. in Crores)
200
1,200
50
300
200
2,000
400
300
20
500
250
ANSWER: 2970 crores
1
CREATED BY: SHUBHAM VERMA (9871778008)
11. Giving reason, explain whether the following are included in domestic product of India. (3)
1) Profits earned by a branch of foreign bank in India.
2) Payment of salaries to its staff by an embassy located in New Delhi.
3) Interest received by an Indian resident from its abroad firms.
12. From the following data, calculate “Net Value Added at Factor Cost”. (4)
S.no.
1)
2)
3)
4)
5)
6)
Content
Sales
Change in Stock
Intermediate consumption
Net indirect taxes
Exports
Depreciation
(Rs. in Lakhs)
400
(-) 20
200
40
50
70
ANSWER: 110 lakhs
13. State any precautions that are taken while calculating national income by expenditure method.
(3)
14. Calculate the Net National Product at Market Price from the given details.
S.NO.
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
CONTENTS
Mixed income of self-employed
Depreciation
Profit
Rent
Interest
Compensation of employees
Net indirect taxes
Net factor income to abroad
Net exports
Net current transfers to abroad
(RS. IN CRORES)
8,000
200
1,000
600
700
3,000
500
60
(-) 50
20
ANSWER: 13,740 crores
15. Giving reason, explain how the following should be treated in the estimation of National
Income. (6)
1) Payment of interest by a firm to a bank.
2) Payment of interest by a bank to an individual.
3) Payment of interest by an individual to a bank.
4) Stipend given by the government to the students studying for their master’s programme in
economics.
16. Give one example of ‘externality’ which reduces welfare of the people.
(2)
17. Explain how ‘ non-monetary exchanges’ are a limitation in taking domestic product as an index
of welfare? (2)
18. Explain how ‘distribution of Gross Domestic Product’ is a limitation in taking Gross Domestic
Product as an index of welfare. (3)
19. Distinguish between Real Gross Domestic Product and Nominal Gross Domestic Product. Which
of these is a better index of welfare of the people and why? (4)
20. Calculate the operating surplus from the following date: (3)
S. NO.
1)
2)
3)
4)
ITEMS
Sales
Compensation of employees
Intermediate Consumption
Rent
RS ( in crores)
4000
800
600
400
2
CREATED BY: SHUBHAM VERMA (9871778008)
5)
6)
7)
8)
Interest
NIT
Consumption of fixed capital
Mixed Income
300
500
200
400
ANSWER: 1500 crores
21.Which of the following is an example of transfer payment: (1)
1) Free meals in the company canteen
2) Employers’ contribution to social security
3) Retirement pension
4) Old-age pension
22. Microeconomics is different from macroeconomics because: (1)
1) Microeconomics deals with economic behaviour
2) Microeconomics deals with individual behaviour
3) Microeconomics deals with prices only
4) Microeconomics deals with the government’s decisions.
3
CREATED BY: SHUBHAM VERMA (9871778008)