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# 50 Important Numerical of Expenditure Method (National Income) with solutions class 12 CBSE Board

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Numerical of national income by expenditure method. National Income. important numerical of expenditure method of national income

## Formula of Expenditure Method to Calculate National Income

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I am solving some very important numerical of expenditure method with board examination point of view.

1 Calculate Net National Product at Market Price:

[CBSE Delhi – 2017]

Solution:-

Gross Domestic Capital Formation = Gross Domestic fixed capital formation + change in stock

Gross Domestic Capital Formation = 400 + 50 = ₹450

GDP at MP = Private Final consumption expenditure + Government Final Consumption Expenditure + Gross domestic capital formation + Net Exports

GDP at MP = 8000 + 3000 + 450 – 60

GDP at MP = ₹11390

NNP at MP = GDP at MP – consumption of fixed capital + NFIA

NNP at MP = 11390 – 40 – (- 80) = ₹11430

2. Calculate National Income

[CBSE Delhi – 2017]

Solution:-

GDP at MP = Private Final consumption expenditure + Government Final Consumption Expenditure + Gross domestic capital formation + Net Exports

GDP at MP = 5000 + 3000 + 1000 + (- 200) = ₹8800

National Income = NNP at FC = GDP at MP – consumption of fixed capital – Net Indirect tax + NFIA

National Income = 8800 – 150 – 800 + 50 = ₹7900 crore

3. Calculate Net Domestic Product at Factor Cost

[CBSE Delhi – 2017]

Solution:-

Gross Domestic Capital Formation = Gross Domestic Fixed capital formation + Change in stock

Gross Domestic Capital Formation = 500 + 100 = ₹600

GDP at MP = Private Final consumption expenditure + Government Final Consumption Expenditure + Gross domestic capital formation + Net Exports (Exports – Imports)

GDP at MP = 8000 + 1000 + 600 + (70 – 120) = ₹9550

NDP at FC = GDP at MP – consumption of fixed capital – Net indirect tax (Indirect tax – subsidies)

NDP at FC = 9550 – 60 – (700 – 50) = ₹8840 crore

4. Calculate National Income

[CBSE (AI) 2016]

Solution:-

Gross Domestic Fixed capital formation = Net domestic fixed capital formation + consumption of fixed capital formation

Gross Domestic Fixed Capital Formation = 120 + 0 = 120

Gross Domestic Capital Formation = Gross Domestic Fixed capital formation + Change in stock

Gross Domestic Capital Formation = 120 + ( – 20) = ₹100

GDP at MP = Private Final consumption expenditure + Government Final Consumption Expenditure + Gross domestic capital formation + Net Exports (Exports – Imports)

GDP at MP = 900 + 200 + 100 + ( – 10) = ₹1190

National Income = NNP at FC = GDP at MP – Consumption of fixed capital + NFIA – Net Indirect tax

National Income = 1190 – 0 + (- 10) – 150 = ₹1030 crore

Further Resources:-

5. Calculate Net National Product at Market Price:

[CBSE (AI) 2016]

Solution:-

Gross Domestic capital formation = Net domestic capital formation + consumption of fixed capital formation

Gross Domestic Capital Formation = 80 + 0 = ₹80

GDP at MP = Private Final consumption expenditure + Government Final Consumption Expenditure + Gross domestic capital formation + Net Exports (Exports – Imports)

GDP at MP = 500 + 100 + 80 + (- 20) = ₹660

NNP at MP = GDP at MP – consumption of fixed capital + NFIA

NNP at MP = 660 – 0 – 20 = ₹ 640 crore

6. Find Gross National Product at Market Price:

Solution:-

Gross Domestic Capital Formation = Net Domestic Capital Formation + Depreciation

Gross Domestic Capital Formation = 200 + 100 = ₹ 300

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross Domestic Capital Formation – Net Imports

GDP at MP = 800 + 300 + 300 – 30

GDP at MP = ₹ 1370

GNP at MP = GDP at MP – Net factor income to abroad

GNP at MP = 1370 – ( – 10)

GNP at MP = ₹ 1380 crore

7. Calculate National Income

[CBSE (F) 2015]

Solution

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net domestic capital formation – net imports

NDP at MP = 100 + 20 + 15 – 5

NDP at MP = 130

National Income (NNP at FC) = NDP at MP – Net factor income to abroad – Net indirect tax

NNP at FC = 130 – (- 5) – 10

NNP at FC = ₹ 125 crore

8. Calculate Net Domestic Product at Market Price.

[CBSE AI 2015]

Solution

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross Domestic Fixed Capital formation + Closing stock – Opening stock + Net Exports (Exports – Imports)

GDP at MP = 400 + 90 + 80 + (20 – 10) + ( 10 – 15 )

GDP at MP = 575

NDP at MP = GDP at MP – Consumption for fixed capital

NDP at MP = 575 – 25

NDP at MP = ₹ 550

9. Calculate Net National Product at Market Price

[CBSE AI 2015]

Solution

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net Domestic Fixed Capital formation + Closing stock – Opening stock – Net Imports

NDP at MP = 300 + 50 + 60 + 8 – 8 – ( – 10)

GDP at MP = 420

NNP at MP = NDP at MP – Net Factor income to abroad

NNP at MP = 420 – (-5)

NNP at MP = ₹ 425 crore

10. Calculate Net Domestic Product at Factor Cost:

[CBSE DELHI 2015]

Solution

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net domestic capital formation – Net imports

NDP at MP = 800 + 200 + 100 – (-20)

NDP at MP = 1120

NDP at FC = NDP at MP – Net Indirect tax

NDP at FC = 1120 – 120

NDP at FC = ₹ 1000 Crore

11. Calculate ‘National Income’.

[CBSE DELHI 2015]

Solution:-

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net Domestic fixed capital formation + change in stocks – Net imports

NDP at MP = 600 + 100 + 70 + (- 10) – 20

NDP at MP = 740

NNP at FC = NDP at MP – Net Factor income to abroad – Net Indirect tax

NNP at FC = 740 – 10 – 60

NNP at FC = ₹ 670 crore

12. Calculate ‘National Income’ from the following

[CBSE F 2014]

Solution:-

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net Domestic fixed capital formation + change in stocks – Net imports

NDP at MP = 700 + 200 + 300 + 30 – 60

NDP at MP = 1170

NNP at FC = NDP at MP – Net factor income to abroad – Net Indirect tax

NNP at FC = 1170 – 20 – 100

NNP at FC = ₹ 1050

13. Calculate ‘Net National Product at Market Price’ from the following.

[CBSE AI 2014]

Solution:-

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net domestic fixed capital formation + (closing stock – Opening stock) + Net Exports (Exports – Imports)

NDP at MP = 600 + 100 + 80 + (10 – 20) + (50 – 60)

NDP at MP = 760

NNP at MP = NDP at MP – Net factor income to abraod

NNP at MP = 760 – 30

NNP at MP = ₹ 730

14. Calculate National Income from the following.

Solution:-

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross domestic fixed capital formation + Net change in stocks – Net imports

GDP at MP = 500 + 100 + 200 + 50 – 40

GDP at MP = 790

NNP at FC = GDP at MP – Depreciation – Net factor income to abroad – Net Indirect tax

NNP at FC = 790 – 70 – (-10) – 120

NNP at FC = ₹ 630 crore

15. Calculate ‘Net Domestic Product at Factor Cost’ from the following:-

[CBSE DELHI 2014]

Solution:-

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross Domestic fixed capital formation + (Closing stock – Opening stock) – Net imports

GDP at MP = 300 + 100 + 50 + (25 – 25) – (- 10)

GDP at MP = 460

NDP at FC = GDP at MP – Consumption of fixed capital – Net indirect tax

NDP at FC = 460 – 20 – 80

NDP at FC = ₹ 360 crore

16. Calculate National Income from the following:

[CBSE DELHI 2014]

Solution:-

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net Domestic capital formation – Net imports

NDP at MP = 600 + 100 + 110 – 20

NDP at MP = 790

NNP at FC = NDP at FC – Net factor income to abroad – (Indirect tax – subsidies)

NNP at FC = 790 – 5 – (120 – 20)

NNP at FC = 785 – 100

NNP at FC = ₹ 685 crore

17. Calculate Gross Fixed Capital Formation from the following data:-

Solution:-

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross Domestic capital formation + Net Exports

2500 = 1000 + 500 + Gross Domestic Capital Formation – 50

Gross Domestic Capital Formation = ₹ 1050

Gross Domestic Capital Formation = Gross Fixed Domestic Capital Formation + Change in stock (Closing Stock – Opening Stock)

1050 = Gross Fixed Domestic Capital Formation + (200 – 300)

Gross Fixed Domestic Capital Formation = 1050 + 100

Gross Fixed Domestic Capital Formation = ₹ 1150 crore

18. Find NDP at FC from the following data.

Solution:-

GDP at MP = Consumption Expenditure + Gross Domestic Fixed Investment + Inventory Investment

GDP at MP = 20000 + 10000 + 5000

GDP at MP = ₹ 35000

NDP at FC = GDP at MP – Depreciation – (Indirect taxes – Subsidies)

NDP at FC = 35000 – 2000 – (1000 – 2000)

NDP at FC = ₹ 34000 crore

19. From the following data, calculate the GDP at both (a) Market price, and (b) Factor Cost.

Solution:-

GDP at MP = Private consumption expenditure + Government purchases of goods and services + Gross Investment + net exports

GDP at MP = 350 + 100 + 90 + 10

GDP at MP = ₹ 550 crore

GDP at FC = GDP at MP – Net Indirect taxes

GDP at FC = 550 – 5

GDP at FC = ₹ 545 crore

20. Calculate the gross national product at factor cost from the following data:-

Solution:-

Gross Domestic capital formation = net domestic fixed capital formation + consumption of fixed capital + Closing stock – Opening stock

Gross Domestic Capital formation = 350 + 50 + 100 – 60

Gross Domestic Capital formation = ₹ 440

GDP at MP = Private Final Consumption Expenditure + Government final consumption expenditure + Gross Domestic capital formation + net exports

GDP at MP = 1500 + 200 + 440 – 10

GDP at MP = ₹ 2130

Gross National Product at FC (GNP at FC) = GDP at MP + Net factor income from abroad – Net Indirect tax

GNP at FC = 2130 – 10 – 50

GNP at FC = ₹ 2070 crore

21. Calculate Gross Domestic Product at market price from the following data:-

Solution:-

Gross Domestic Capital Formation = Net Domestic Capital Formation + consumption of fixed capital

Gross Domestic capital formation = 300 + 50 = ₹ 350

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross domestic capital formation + Net Exports (Exports – Imports)

GDP at MP = 500 + 200 + 350 + (25 – 40)

GDP at MP = ₹ 1035 crore

22. Calculate national income from the following data:-

Solution:-

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + Gross Domestic capital formation + exports – imports

GDP at MP = 500 + 200 + 100 + 80 – 70

GDP at MP = 810

NNP at FC = GDP at MP – consumption of fixed capital + Net factor income received from abroad – Net indirect tax

NNP at FC = 810 – 20 – 10 – 60

NNP at FC = ₹ 720 crore

23. Calculate NNP at MP from the following data:-

Solution:-

NDP at MP = Household final consumption expenditure + Final consumption expenditure of private non profit institutions serving households + Government final consumption expenditure + Net domestic fixed capital formation + net change in stocks + net exports

NDP at MP = 1000 + 50 + 200 + 100 + 40 – 20

NDP at MP = 1370

NNP at MP = NDP at MP + Net factor income from abroad

NNP at MP = 1370 + 10

NNP at MP = 1380 crore

24. Calculate GNP at MP from the following data:-

Solution:-

Gross Domestic capital formation = Net domestic fixed capital formation + consumption of fixed capital + closing stock – opening stock

Gross Domestic capital formation = 200 + 40 + 50 – 40

Gross Domestic Capital formation = 250

GDP at MP = Private final consumption expenditure + Government final consumption expenditure + G- ross Domestic capital formation + Net exports

GDP at MP = 2000 + 300 + 250 – 5

GDP at MP = 2545

GNP at MP = GDP at MP + Net factor income from abroad

GNP at MP = 2545 – 10

GNP at MP = ₹ 2535 crore

25. Calculate NVA at FC from the following data:-

Solution:-

Value of output = Sales + closing stock – opening stock

Value of output = 1000 + 100 – 80

Value of output = 1020

NVA at MP = Value of Output – Intermediate cost

NVA at MP = 1020 – 420

NVA at MP = 600

NVA at FC = NVA at MP – (Indirect tax – subsidies)

NVA at FC = 600 – 60 + 10

NVA at FC = ₹ 550 crore

26. Find value added by firm X from the following data:-

Solution:-

Value of output of firm X = Sales by firm X to firm Z + Purchases by firm Y from firm X + closing stock of firm X – Opening stock of firm X

Value of output of firm X = 200 + 100 + 40 – 50

Value of output of firm X = 290

Value added by firm X = Value of output of firm X – Sale by firm Z to firm X

Value added by firm X = 290 – 150

Value added by firm X = ₹ 140

27. A Farmer purchases ₹ 1,000 worth of seeds, ₹ 2000 worth of fertilisers, and pays ₹ 1500 as water charges to raise a wheat crop. He produces 50 quintals of wheat and sells the same at ₹ 200 per quintal. Calculate value added by the farmer.

Solution:-

farmer Value of Output = quantity * price = 50 * 200 = 10000

Intermediate consumption of farmer = seeds + fertilisers + water charges

Intermediate consumption of farmer = 1000 + 2000 + 1500

Intermediate consumption of farmer = 4500

Value added by farmer = Value of output – Intermediate consumption

Value added by farmer = 10000 – 4500

Value added by farmer = ₹ 5500

28. There are two firms A and B. A buys, ₹ 200 worth of raw materials from B. B buys ₹ 300 worth of raw materials from A. The value of total output of firm A is ₹ 1000 and that of B is ₹ 1,500. Find out value added by A and B. What measure of Value added is this?

Solution:-

Value added by firm A = value of output – purchase of raw material by firm A from B

Value added by firm A = 1000 – 200 = ₹ 800

Value added by firm B = Value of Output – purchase of raw material by firm B form A

Value added by firm B = 1500 – 300

Value added by firm B = ₹ 1200

29. Calculate NDP at factor cost:-

Solution:-

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net domestic fixed capital formation + Closing stock – Opening stock + Net Exports (Exports – Imports)

NDP at MP = 300 + 100 + 70 + 15 – 5 + (20 – 30)

NDP at MP = ₹470

NDP at FC = NDP at MP – Net Indirect tax

NDP at FC = 470 – 80

NDP at FC = ₹ 390 crore

30. Calculate National Income:-

Solution:-

NDP at MP = Private final consumption expenditure + Government expenditure on providing free services + Net domestic capital formation – Net imports

NDP at MP = 350 + 75 + 60 – 15

NDP at MP = ₹ 470

NNP at FC = NDP at MP – Net factor income to abroad – Net indirect tax (GST – Subsidies)

NNP at FC = 470 + 15 – (30 – 5)

NNP at FC = ₹ 460 crore

31. Calculate NNP at MP:-

Solution:-

NDP at MP = Private final consumption expenditure + Government final consumption expenditure + Net Dometic capital formation + closing stock – opening – Net imports

NDP at MP = 500 + 150 + 70 + 20 – 20 + 30

NDP at MP = ₹ 750

NNP at MP = NDP at MP + NFIA (Factor income received from abroad – Factor income paid to abroad)

NNP at MP = 750 + (10 – 15)

NNP at MP = ₹ 745 crore

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