GNP at market price is ₹2,100 crore and net indirect taxes are ₹160 crore. What is GNP at factor cost?
Answer and explanation
Correct answer: ₹1,940 crore
For any aggregate, the conversion is Aggregate at Factor Cost = Aggregate at Market Price − Net Indirect Taxes. Thus, GNP at factor cost = ₹2,100 crore − ₹160 crore = ₹1,940 crore. Option B is correct. Option C leaves the tax unadjusted, while option D adds it in the wrong direction; option A subtracts ₹320 crore instead of the stated ₹160 crore.
Frequently asked questions
What is the correct answer to this question?
₹1,940 crore
Why is this the correct answer?
For any aggregate, the conversion is Aggregate at Factor Cost = Aggregate at Market Price − Net Indirect Taxes. Thus, GNP at factor cost = ₹2,100 crore − ₹160 crore = ₹1,940 crore. Option B is correct. Option C leaves the tax unadjusted, while option D adds it in the wrong direction; option A subtracts ₹320 crore instead of the stated ₹160 crore.
Which subject and chapter does this question cover?
This is a Class 12 Economics question. Chapter: National Income and Related Aggregates. Topic: Aggregates related to national income - GNP.
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