Question:
Calculate the value of Net Value Added at Factor Cost (NVA\textsubscript{FC}):
S. No. Particulars Amount (in ₹ crore) (i) Operating Surplus 3,740 (ii) Increase in unsold stock 600 (iii) Sales 10,625 (iv) Purchase of raw materials 2,625 (v) Consumption of fixed capital 500 (vi) Subsidies 400 (vii) Indirect taxes 1,200
Calculate the value of Net Value Added at Factor Cost (NVA\textsubscript{FC}):
| S. No. | Particulars | Amount (in ₹ crore) |
|---|---|---|
| (i) | Operating Surplus | 3,740 |
| (ii) | Increase in unsold stock | 600 |
| (iii) | Sales | 10,625 |
| (iv) | Purchase of raw materials | 2,625 |
| (v) | Consumption of fixed capital | 500 |
| (vi) | Subsidies | 400 |
| (vii) | Indirect taxes | 1,200 |
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Always include 'Change in Stock', 'Subsidies', and subtract 'Indirect Taxes' and 'Depreciation' when calculating NVA\textsubscript{FC.
Updated On: Jun 27, 2025
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Solution and Explanation
Formula:
\[
NVA_{FC} = \text{Sales} + \text{Change in stock} - \text{Raw material cost} - \text{Consumption of fixed capital} + \text{Subsidies} - \text{Indirect taxes}
\]
Calculation:
\[
= 10,625 + 600 - 2,625 - 500 + 400 - 1,200
\]
\[
= 10,625 + 600 - 2,625 - 500 + 400 - 1,200
= 7,300
\]
Therefore, Net Value Added at Factor Cost (NVA\textsubscript{FC}) = ₹ 7,300 crore.
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