If a trader buys goods for ₹7,80,000, sells them for ₹9,25,000, and spends ₹22,000 on transport service and ₹18,000 on packing material, what is his GVA at market prices?
Answer and explanation
Correct answer: ₹1,05,000
The trader’s gross trading margin is sales minus the purchase price of goods: ₹9,25,000 − ₹7,80,000 = ₹1,45,000. Transport service and packing material are additional intermediate inputs costing ₹22,000 + ₹18,000 = ₹40,000. Therefore, GVA at market prices = ₹1,45,000 − ₹40,000 = ₹1,05,000, so option B is correct.
Frequently asked questions
What is the correct answer to this question?
₹1,05,000
Why is this the correct answer?
The trader’s gross trading margin is sales minus the purchase price of goods: ₹9,25,000 − ₹7,80,000 = ₹1,45,000. Transport service and packing material are additional intermediate inputs costing ₹22,000 + ₹18,000 = ₹40,000. Therefore, GVA at market prices = ₹1,45,000 − ₹40,000 = ₹1,05,000, so option B is correct.
Which subject and chapter does this question cover?
This is a Class 11 Economics question. Chapter: National Income and Related Aggregates. Topic: GDP and Welfare.
