If net indirect taxes fall from ₹160 crore to negative ₹40 crore, what is the total change?
Answer and explanation
Correct answer: ₹200 crore decrease
The governing relation is that net indirect taxes equal the difference between market price and factor cost, and the numerical change must be calculated as final value minus initial value. Here, change = (-₹40 crore) − ₹160 crore = -₹200 crore. The negative sign means a decrease of ₹200 crore, so option C is correct. ₹120 crore would result from ignoring the negative final value.
Frequently asked questions
What is the correct answer to this question?
₹200 crore decrease
Why is this the correct answer?
The governing relation is that net indirect taxes equal the difference between market price and factor cost, and the numerical change must be calculated as final value minus initial value. Here, change = (-₹40 crore) − ₹160 crore = -₹200 crore. The negative sign means a decrease of ₹200 crore, so option C is correct. ₹120 crore would result from ignoring the negative final value.
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.
