GK: National Income Accounting, Part 01

1. Which of the following items will be included in National Income?

A) Interest paid by one firm to another.
B) Interest received on debenture by share holders
C) Money received by people from their family members who are permanently settled abroad.
D) Gains from the sale of shares.

... Answer is B)

2. Nat National Product at factor cost is also known as:

A) Net Domestic Product
B) Gross Domestic Product
C) National Income
D) Personal Income

... Answer is C)

3. Which of the following items is not included in GNPmp?

A) Salaries and wages before taxes.
B) Indirect taxes
C) Remittances by NRIs
D) Subsidy

... Answer is C)

4. When indirect taxes are subtracted from NNPmp and subsidies are added, then it will be equal to:

A) Domestic income
B) NNPfc
C) GNPfc
D) NNPmp

... Answer is B)

5. NDPfc is less than NNPfc when:

A) NFIA is positive
B) NFIA is negative
C) NFIA is zero
D) Net exports is positive

... Answer is A)

6. As per the value added method of measuring national income which of the following items will not be added?

A) Production of self-employed
B) Imputed rent
C) Brokerage earned by selling second hand goods
D) Sale of second hand goods.

... Answer is D)

7. What will be deducted to get NDPmp from GDPmp?

A) NFIA
B) Indirect taxes
C) Depreciation
D) Transfer payment.

... Answer is C)

8. While estimating national income, which of the following item is not included?

A) Rent
B) Mixed income
C) Fixed investment
D) Undistributed profit

... Answer is C)

9. Net market value of all the final goods and services produced by normal resodents of a country during an accounting year is called:

A) GDPfc
B) NNPfc
C) NNPmp
D) GDPmp

... Answer is C)

10.Which of the following is not a component of domestic income?

A) Compensation of employees
B) Operating surplus
C) Mixed income
D) NFIA

... Answer is D)
NFIA= Net factor income from abroad.

11.Factor cost is equal to:

A) Market price - Indirect tax
B) Market price - Net indirect tax
C) Market price + Indirect tax
D) Market Price + Net indirect tax

... Answer is B)

12. What is not true about the term National Income?

A) National income excludes NFIA
B) National income excludes transfer payment.
C) National income excludes depreciation.
D) National income excludes indirect taxes.

... Answer is A)

13. A better measure of economic growth is:

A) Increase in GDP at current prices.
B) Increase in GNP at current prices.
C) Increase in GDP at constant prices.
D) Increase in per capital income at constant prices.

... Answer is C)

14. GDP at constant prices is called:

A) Real GDP
B) Nominal GDP
C) Real national income
D) Nominal per capita income

... Answer is A)

15. Which of the following is included in the economic territory of a country?

A) Political frontiers of a country
B) Ships and aircrafts operated by the residents between two countries.
C) Embassies operated in other countries.
D) All of the above.

... Answer is D)

16.Indian ships operated between India and USA are included in the domestic territory of:

A) India
B) USA
C) Both India & USA
D) Neither India not USA

... Answer is A)

17.Indian Embassy in America is the part of the economic territory of:

A) America
B) India
C) Americal and India both
D) None of the above

... Answer is B)

18. State which of the following statement is not true:

A) Citizen of a country is necessarily the resident of that country.
B) Citizen of a country is not necessarily the resident of that country.
C) Citizen and rersident are two different concepts.
D) A person can be a citizen as well as a resident.

... Answer is A)

19. GDP is greater than GNP when:

A) NFIA is positive
B) NFIA is negative
C) NFIA is zero
D) Net exports is positive.

... Answer is B)

20.Market value of all the final goods and services produced within the domestic territory of a country during a year is called:

A) GDPmp
B) GDPfc
C) GNPmp
D) GNPfc

... Answer is C)