Question

Calculate National Income and Personal Disposable Income:

		(Rs crore)
(i)	Corporate tax	100
(ii)	Private final consumption expenditure	900
(iii)	Personal Income tax	120
(iv)	Government final consumption expenditure	200
(v)	Undistributed profits	50
(vi)	Change in stocks	(-)20
(vii)	Net domestic fixed capital formation	120
(viii)	Net imports	10
(ix)	Net indirect tax	150
(x)	Net factor income from abroad	(-)10
(xi)	Private income	1000

Answer 1

GDP_MP = Private Final Consumption Expenditure + Government Final Consumption Expenditure + (Net Domestic Fixed Capital Formation + Depreciation + Change in Stock) − Net Imports

= 900 + 200 + (120 + 0 + (−20) − 10 = 1,190

NNP_FC = GDP_MP + Net Factor Income from Abroad – Net Indirect Tax − Depreciation

= 1,190 + (−10) − 150 − 0 = 1,030

National Income = Rs 1,030 crore

Personal Disposable Income = Private Income − Undistributed Profits − Corporate Tax − Personal Direct Taxes

= 1,000 − 50 − 100 − 120 = 730

= Rs 730 crore