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Question
Calculate National Income using Income method and Output method.
| PARTICULARS | (₹ crores) | |
| (i) | Value of output | 1200 |
| (ii) | Wages and salaries | 165 |
| (iii) | Rent | 60 |
| (iv) | Subsidies | 15 |
| (v) | Mixed Income of self employed | 180 |
| (vi) | Employer's contribution to social security | 15 |
| (vii) | Value of intermediate consumption | 600 |
| (viii) | Interest | 7 |
| (ix) | Factor income earned from abroad | 15 |
| (x) | Indirect taxes | 90 |
| (xi) | Profits | 23 |
| (xii) | Depreciation | 75 |
| (xiii) | Factor income paid abroad | 30 |
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Solution
Income Method:
NDPFC Compensation to employees + Operating Surplus + Mixed Income
= (165 + 15) + (60 + 7 + 23) + 180
= 450
NNFFC = NDPFC + NFIA
= 450 + (−15)
= 435 crores
Output method:
GVA = GDPMP
= Value of output − Value of Intermediate Consumption
= 1,200 − 600
= 600 crores
NNPFC = GDPMP − Depreciation + NFIA − NIT
= 600 − 75 + (−15) − (90 − 15)
= 435 crores
The National Income calculated using the Income method is ₹ 435 crores, while the Output method is also ₹ 435 crores.
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