Question
Consider the following statements:
Select the correct answer using the code given below:
- Net Factor Income from Abroad is equivalent to the net of exports & imports
- Net of Indirect taxes and subsidies are included in the calculation of national income
Select the correct answer using the code given below:
Answer: Option B
Answer: (b)
Goods and services produced in India and sold outside the country i.e. to foreigners are referred to as exports. But the Net Factor Income from Abroad (NFIA) is the income earned by the four factors of production from abroad.
In case of NFIA, the production happens abroad but in case of exports, the production happens in the domestic country. So NFIA is different from exports and hence statement (i) is false
Now (post-2015), the indirect taxes and subsidies are included in the GDP and GNP calculation.
So, statement (ii) is true
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Answer: (b)
Goods and services produced in India and sold outside the country i.e. to foreigners are referred to as exports. But the Net Factor Income from Abroad (NFIA) is the income earned by the four factors of production from abroad.
In case of NFIA, the production happens abroad but in case of exports, the production happens in the domestic country. So NFIA is different from exports and hence statement (i) is false
Now (post-2015), the indirect taxes and subsidies are included in the GDP and GNP calculation.
So, statement (ii) is true
Was this answer helpful ?
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