Tag: methods of national income

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Questions Related to methods of national income

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Given Real GDP 9% and rate of inflation 2.25%, the norminal GDP will be ___.

  1. 9%

  2. 11.25%

  3. 6.75%

  4. 8%
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Nominal GDP equals real GDP plus the inflation rate. Adding 9% and 2.25% gives 11.25%. This shows how inflation affects the nominal value of output.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

"Determination of wage rate, distribution of national income" was the theory given by?

  1. Adam smith

  2. A. marshall

  3. Ricardo

  4. Pigon
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Alfred Marshall is widely recognized for his work in neoclassical economics, including the theory of distribution and the determination of factor prices.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

For studying the various national income components it is required that data should be collected on _______________.

  1. Expenditure

  2. Investments

  3. Income

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

To get a comprehensive view of national income, data on all three aspects (expenditure, investment, and income) are necessary to cross-verify and calculate the aggregates.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

The net values added (NVA) method of measuring national income is also known as ______.

  1. net output method

  2. production method

  3. industry of origin method

  4. all of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The NVA method of measuring national income is also known as net output method, production method and industry of origin method.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Identify the items which is not a factor payment.

  1. Free uniform to defense personnel

  2. Salaries to the members of Parliament

  3. Imputed rent of an owner occupied building

  4. Scholarship given to the scheduled caste students
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Factors payments are those payments, which are made to factors of production e.g. rent, interest, profit, wages etc. Scholarships given to the scheduled caste students is not a factor payment, it is a transfer payment and it will not be included in national income.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

If Willingness to Save is less, the level of ________ will be higher.

  1. Government regulated Savings

  2. Compulsory Savings

  3. Forced Savings

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

When voluntary savings are insufficient, governments may resort to forced savings through measures like taxation, inflation, or mandatory provident funds to increase the total savings in the economy.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Expenditure Method focusses on measurement of National Income at _____________________.

  1. phase of Production of Goods and Services

  2. phase of Income Distribution

  3. phase of Income Disposition

  4. all of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The expenditure method measures national income by summing up all final expenditures in the economy, which corresponds to the phase of income disposition (spending).

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

_________ method is suitable for measuring National Income in the case of Agricultural sector.

  1. Product

  2. Income

  3. Expenditure

  4. All of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The product method is most suitable for the agricultural sector because it is easier to estimate the physical output and value added in agriculture than to track income or expenditures of farmers.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Income method focusses on measurement of National Income at ______________________.

  1. phase of Production of Goods and Services

  2. phase of Income Distribution

  3. phase of Income Disposition

  4. all of the above
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The income method measures national income by summing the factor incomes generated during the production process, which represents the distribution phase of income.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

The production method of calculating national income is also known as _______________.

  1. value added method

  2. income method

  3. expenditure method

  4. none of the above
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The production method is also known as the value added method because it calculates the net contribution of each sector by subtracting intermediate consumption from the value of output.