Question

Calculate National Income:
Compensation of employees = ₹500 crore
Rent = ₹100 crore
Interest = ₹150 crore
Profit = ₹250 crore
Mixed Income = ₹50 crore

Hint:

"Operating Surplus" is a collective term for property and entrepreneurial income (Rent + Interest + Profit). Always group them together if they are listed separately.

Answer 1

Step 1: Understanding the Concept:
National Income ($\text{NNP}_{\text{FC}}$) can be calculated using the Income Method. The first step is to find the Net Domestic Product at Factor Cost ($\text{NDP}_{\text{FC}}$), also known as Domestic Income.

Step 2: Formula for Domestic Income:
$\text{NDP}_{\text{FC}} = \text{Compensation of Employees (COE)} + \text{Operating Surplus (Rent + Interest + Profit)} + \text{Mixed Income}$

Step 3: Calculation:

• $\text{COE} = 500$
• $\text{Operating Surplus} = 100 + 150 + 250 = 500$
• $\text{Mixed Income} = 50$

$\text{NDP}_{\text{FC}} = 500 + 500 + 50 = 1050 \text{ crore}$

Step 4: Final Answer:
Since no "Net Factor Income from Abroad" (NFIA) is provided in the data, we assume it is zero. Therefore, National Income ($\text{NNP}_{\text{FC}}$) = $\text{NDP}_{\text{FC}} + \text{NFIA}$. $\text{National Income} = 1050 + 0 = ₹1050 crore$.