If NDP at factor cost is ₹7,100 crore and net indirect taxes are ₹500 crore what will be NDP at market price?
Answer and explanation
Correct answer: ₹7,600 crore
The governing formula is NDP at market price = NDP at factor cost + net indirect taxes. Substituting the given values gives ₹7,100 crore + ₹500 crore = ₹7,600 crore. Therefore, option C is correct. Option B is the factor-cost figure before adjustment; option A subtracts the tax, and option D adds too much.
Frequently asked questions
What is the correct answer to this question?
₹7,600 crore
Why is this the correct answer?
The governing formula is NDP at market price = NDP at factor cost + net indirect taxes. Substituting the given values gives ₹7,100 crore + ₹500 crore = ₹7,600 crore. Therefore, option C is correct. Option B is the factor-cost figure before adjustment; option A subtracts the tax, and option D adds too much.
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 - Market price and factor cost.
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