Question

From the information given below, calculate :
`**` Value added by firm A and firm B,
`**` Gross Domestic Product at market price,
`**` Net Domestic Product at factor cost.

Answer 1

Correct Answer - Rs. 200 crores
Rs. 260 crores
Rs. 460 crores
Rs. 265 crores
Value added by firm A
=Sales by firm A + Change in stock of firm A- Purchases by firm A
=500+20-320
=Rs. 200 crores
Value added by firm B
=Sales by firm B to general government+Sales by firm B to housholds+(Closing stock of firm B - Opening stock of firm B)-Purchases by firm B from firm A
=100+350+(40-30)-200
=Rs. 260 crores
Gross Domestic Product at market price
=Value added by firm A+Value added by firm B
=200+260=Rs. 460 crores
Net Domestic Product at factor cost
=Gross Domestic product at market price-Consumption of fixed capital-Indirect Taxes paid by both the firms
=460-120-75
=Rs. 265 crores