# National Income and Related Aggregates (CBSE (Central Board of Secondary Education- Board Exam) Class-12 Economics): Questions 33 - 38 of 68

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## Question number: 33

» National Income and Related Aggregates » Stocks and Flows

Appeared in Year: 2012

Essay Question▾

### Describe in Detail

Autonomous consumption = 100 Rs.

Marginal propensity to consume = 0.70

National income = 1000 Rs.

### Explanation

In this C = 100 Rs.

Pc (b) = 0.70

Y = 1000

So, consumption expenditure = + by

= 100 + 0.70 1000

=100 + 700

= Rs. 800

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## Question number: 34

» National Income and Related Aggregates » Gross National Product

Appeared in Year: 2012

Essay Question▾

### Describe in Detail

Giving reason explain how should the following be treated in estimating national income:

(i) Interest paid by banks on deposits by individuals.

(ii) National debt interest.

### Explanation

(I) Interest paid by bank on deposits should be included in the

Estimation of National Income because it is a factor income

For the account holders.

(iii) National debt interest should not be included in

the estimation of National Income because it is not known

Whether the government has borrowed for consumption purposes

## Question number: 35

» National Income and Related Aggregates » Types of Goods

Appeared in Year: 2012

Essay Question▾

### Describe in Detail

Given price of a good, how does a consumer decide as to how much of that good is to be purchased?

### Explanation

In this a consumer compares marginal utility of the good with its price. The consumer will be at equilibrium when the marginal utility of good is equal to price of good.

It is represented as =

If > then price is less than marginal utility. So, consumer will buy more good. And if < then price is more than marginal utility t

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## Question number: 36

» National Income and Related Aggregates » Methods of Calculating National Income » Expenditure Method

Essay Question▾

### Describe in Detail

Explain the ‘expenditure’ method of estimating national income.

### Explanation

The expenditure method of measuring National Income is also called Income disposal Method. Expenditure method is a method which measures the final expenditure on gross private product at market price during an accounting year.

Then all privately produced goods and services are purchased for final use either by consumers for consumption or by pr

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## Question number: 37

» National Income and Related Aggregates » Methods of Calculating National Income » Expenditure Method

Essay Question▾

### Describe in Detail

From the following data calculate National Income by Income and Expenditure methods:

 (Rs crore) Government final consumption expenditure 100 Subsidies 10 Rent 200 Wages and salaries 600 Indirect taxes 60 Private final consumption expenditure 800 Gross domestic capital formation 120 Social security contributions by employers 55 Royalty 25 Net factor income paid to abroad 30 Interest 20 Consumption of fixed capital 10 Profit 130 Net exports 70 Change in stock 50

### Explanation

National income by income method = Rent + Royalty + wages and salaries + Social security contributions by employers + Interest + Profit - Net factor income paid to abroad

=

=rs1000crore.

National income by expenditure method = Government final consumption expenditure + Private final consumption expenditure + Gross dom

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## Question number: 38

» National Income and Related Aggregates » Gross National Product

Essay Question▾

### Describe in Detail

Calculate Gross National Product at Market Price and Net National Disposable Income from the following data:

 - ( Rs. crores) Current transfers from government 25 Compensation of employees 600 Net current transfers from the rest of the world 20 Rent 100 Consumption of fixed capital 50 Interest 120 Net indirect tax 110 Profit 80 Mixed income of the self-employed 200 Net factor income from abroad (-) 10

### Explanation

(national product) NDP = Rent + Internet + Profit + Compensation of employees + Mixed income of the self-employed

= 100 + 120 + 80 + 600 + 200

= Rs. 1100 crores.

(Gross National Product) GNP = NDP + Net factor income from abroad + Net indirect tax + Consumption of fixed capital

=

=Rs 1250 Crores

Net National Disposabl

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