**Example 8: Calculate Factor Income to Abroad**The table provides a set of financial figures related to national accounts, expressed in crores of Indian Rupees (₹).| Particulars | ₹ in crores ||--------------------------------------|-------------|| (i) GNP at MP | 4,500 || (ii) Replacement of Fixed Capital | 100 || (iii) Indirect Taxes | 300 || (iv) Subsidies | 200 || (v) Factor Income from abroad | 700 || (vi) NDP at FC | 3,900 |This table is used to calculate the Factor Income to Abroad by utilizing values such as Gross National Product at Market Prices (GNP at MP) and Net Domestic Product at Factor Cost (NDP at FC), among others. Each figure represents important economic indicators that reflect various components of a nation's income.

We need to calculate the value of factor income to abroad. We know that factor income to abroad is a part of GNP at MP The formula for GNP at Market price is :- = NDPFC + replacement of fixed capital + ( factor income from abroad - factor income to abroad) + ( Indirect taxes - subsidies ) Putting values :- 4500 = 3900 + 100 + ( 700 - Factor income to abroad ) + ( 300 - 200 ) 4500 = 4700 - Factor income to abroad + 100 Factor Income to abroad= 4800 - 4500 = $300 Hope this helps

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Example 8. Calculate Factor Income to abroad. Particulars in crores (1) GNP at MP 4,500 () Replacement of Fixed Capital (ii) Indirect Taxes (iv) Subsidies (v) Factor Income from abroad (vi) NDP at FC 100 300 200 700 3,900 Solution:

Example 8. Calculate Factor Income to abroad. Particulars in crores (1) GNP at MP 4,500 () Replacement of Fixed Capital (ii) Indirect Taxes (iv) Subsidies (v) Factor Income from abroad (vi) NDP at FC 100 300 200 700 3,900 Solution:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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