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Which is considered as the official GDP of India?
- a)GDP at factor cost in constant prices
- b)GDP at factor cost in current prices
- c)GDP at market cost in constant prices
- d)GDP at market cost in current prices
Correct answer is option 'C'. Can you explain this answer?
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Verified Answer
Which is considered as the official GDP of India?a)GDP at factor cost ...
Till 2015, GDP was measured in terms of factor cost at constant prices. This has been changed from 2015 onwards, GDP at market cost and at constant prices will be considered as India’s GDP.
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Which is considered as the official GDP of India?a)GDP at factor cost ...
GDP at market cost in constant prices is considered as the official GDP of India
Explanation:
Gross Domestic Product (GDP) is the total value of all final goods and services produced within the domestic territory of a country in a given period of time. GDP is an important indicator of the economic health of a country. In India, the Central Statistical Office (CSO) under the Ministry of Statistics and Programme Implementation (MOSPI) is responsible for estimating GDP.
There are two methods of calculating GDP - the factor cost method and the market cost method. The factor cost method measures the value of goods and services at the production stage, while the market cost method measures the value of goods and services at the market prices.
In India, the official GDP is calculated using the market cost method in constant prices. Constant prices refer to a base year, against which the prices of goods and services in the current year are compared. This is done to remove the effect of inflation on GDP.
The use of market cost method in constant prices gives a more accurate picture of the real growth of the economy, as it takes into account the changes in both prices and production levels. This method also allows for international comparisons of GDP, as it provides a standard measure of economic output across countries.
In conclusion, the official GDP of India is calculated using the market cost method in constant prices. This method provides a more accurate picture of the real growth of the economy and allows for international comparisons of GDP.
Explanation:
Gross Domestic Product (GDP) is the total value of all final goods and services produced within the domestic territory of a country in a given period of time. GDP is an important indicator of the economic health of a country. In India, the Central Statistical Office (CSO) under the Ministry of Statistics and Programme Implementation (MOSPI) is responsible for estimating GDP.
There are two methods of calculating GDP - the factor cost method and the market cost method. The factor cost method measures the value of goods and services at the production stage, while the market cost method measures the value of goods and services at the market prices.
In India, the official GDP is calculated using the market cost method in constant prices. Constant prices refer to a base year, against which the prices of goods and services in the current year are compared. This is done to remove the effect of inflation on GDP.
The use of market cost method in constant prices gives a more accurate picture of the real growth of the economy, as it takes into account the changes in both prices and production levels. This method also allows for international comparisons of GDP, as it provides a standard measure of economic output across countries.
In conclusion, the official GDP of India is calculated using the market cost method in constant prices. This method provides a more accurate picture of the real growth of the economy and allows for international comparisons of GDP.
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Which is considered as the official GDP of India?a)GDP at factor cost in constant pricesb)GDP at factor cost in current pricesc)GDP at market cost in constant pricesd)GDP at market cost in current pricesCorrect answer is option 'C'. Can you explain this answer?
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