Question

On the basis of the data given below for an imaginary economy, estimate the value of Net Domestic Product at Factor Cost (NDP_{fc}): \[ \begin{array}{|c|l|c|} \hline \textbf{S.No.} & \textbf{Items} & \textbf{Amount (in Rs. Cr.)} \\ \hline & \text{Gross Domestic Fixed Capital Formation} & 200 \\ & \text{Exports} & 50 \\ & \text{Government Final Consumption Expenditure} & 320 \\ & \text{Consumption of Fixed Capital} & 35 \\ & \text{Household Final Consumption Expenditure} & 470 \\ & \text{Inventory Investment (Net)} & -40 \\ & \text{Imports} & 60 \\ & \text{Net Indirect Taxes} & 50 \\ & \text{Net Factor Income from Abroad} & 20 \\ \hline \end{array} \]

Hint:

To calculate NDPfc, always subtract indirect taxes and depreciation from GDP and consider only domestic factors.

Answer 1

Net Domestic Product at Factor Cost (NDPfc) is calculated as: \[ NDPfc = (v) + (iii) + (i) + (vi) + (ii) - (vii) - (iv) - (viii) \] \[ = 470 + 320 + 200 + (-40) + (50 - 60) - 35 - 50 \] \[ = 855 { crore} \]