National and Per Capita Income AFCAT Questions

AFCAT Indian Economy

National and Per Capita Income MCQ Questions


7.
Net Domestic Product (NDP) is defined as:
A.
Gross Domestic Product (GDP) plus imports
B.
Gross Domestic Product (GDP) minus depreciation (the consumption of fixed capital during the period)
C.
Gross National Product (GNP) minus Net Factor Income from Abroad
D.
Gross Domestic Product (GDP) plus depreciation
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ANSWER :
B. Gross Domestic Product (GDP) minus depreciation (the consumption of fixed capital during the period)
8.
Per capita income of a country is calculated as:
A.
The country's national income divided by its total (mid-year) population
B.
The country's GDP multiplied by its total population
C.
The average income earned only by government employees
D.
The highest individual income earned in the country during the year
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ANSWER :
A. The country's national income divided by its total (mid-year) population
9.
'Personal Income' refers to:
A.
The income earned exclusively by self-employed professionals
B.
The total profit retained by all companies in the economy
C.
The total income actually received by individuals and households from all sources, including transfer payments, before the deduction of direct personal taxes
D.
The total tax revenue collected by the government from individuals
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ANSWER :
C. The total income actually received by individuals and households from all sources, including transfer payments, before the deduction of direct personal taxes
10.
'Personal Disposable Income' refers to:
A.
Total national income before any deductions whatsoever
B.
Personal income minus direct personal taxes (such as income tax) and other compulsory non-tax payments to the government
C.
The income earned only from financial investments such as shares and bonds
D.
The total amount of money in circulation in the economy
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ANSWER :
B. Personal income minus direct personal taxes (such as income tax) and other compulsory non-tax payments to the government
11.
National income aggregates can be valued either 'at market price' or 'at factor cost'. The key difference between these two methods of valuation is:
A.
Market price applies only to exported goods, while factor cost applies only to imported goods
B.
There is no real difference between the two; they are simply two different names for the same value
C.
Market price includes net indirect taxes (indirect taxes minus subsidies), while factor cost reflects only the amount actually received by the factors of production
D.
Market price is used only in developed countries, while factor cost is used only in developing countries
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ANSWER :
C. Market price includes net indirect taxes (indirect taxes minus subsidies), while factor cost reflects only the amount actually received by the factors of production
12.
As per standard Indian national income accounting convention, the term 'National Income' (without further qualification) most precisely refers to:
A.
Gross Domestic Product at Market Price (GDP at MP)
B.
Gross National Product at Market Price (GNP at MP)
C.
Net Domestic Product at Market Price (NDP at MP)
D.
Net National Product at Factor Cost (NNP at FC)
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ANSWER :
D. Net National Product at Factor Cost (NNP at FC)