Worksheet: National Income Accounting - 3 | Business Economics for CA Foundation PDF Download

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Q1: Macro Economics: Macroeconomics studies _________ economic variables of an economy.

Q2: Consumption Goods: Durable goods include items like _________ and television.

Q3: Intermediate Goods: Milk used by a tea shop for selling tea is an example of an _________ good.

Q4: Investment: Investment is the net addition made to the existing stock of _________.

Q5: Domestic Territory: It includes political frontiers, territorial waters, air space, and even _________ located abroad.

Q6: Real GDP: Real GDP reflects changes in _________ output, making it a reliable indicator of economic development.

Q7: Income Method: Compensation of employees and operating surplus are components of the _________ method.

Q8: National Disposable Income: NNPFC + Net Indirect tax + Net current transfer from abroad = _________.

Q9: Personal Income: Personal Income includes factor income, net factor income from abroad, interest on national debt, current transfer from government, and current transfer from _________.

Q10: Circular Flow: Households provide factors of production to firms, and firms supply goods and services to _________.

Assertion and Reason Based

Q1: Assertion: Real GDP is a reliable indicator of economic development.
Reason: It accounts for changes in physical output and price levels.
(a) Both Assertion and Reason are true, and Reason is the correct explanation of Assertion.
(b) Both Assertion and Reason are true, but Reason is not the correct explanation of Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q2: Assertion: Net Investment is calculated by subtracting depreciation from gross investment.
Reason: Depreciation refers to the fall in the value of fixed assets due to normal wear and tear.
(a) Both Assertion and Reason are true, and Reason is the correct explanation of Assertion.
(b) Both Assertion and Reason are true, but Reason is not the correct explanation of Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q3: Assertion: Domestic territory includes political frontiers and ships operated by residents between countries.
Reason: Domestic territory only includes political boundaries and excludes international waters.
(a) Both Assertion and Reason are true, and Reason is the correct explanation of Assertion.
(b) Both Assertion and Reason are true, but Reason is not the correct explanation of Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q4: Assertion: Nominal GDP is unaffected by changes in price levels.
Reason: Nominal GDP is calculated using the prices of the current year.
(a) Both Assertion and Reason are true, and Reason is the correct explanation of Assertion.
(b) Both Assertion and Reason are true, but Reason is not the correct explanation of Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Q5: Assertion: National Disposable Income includes depreciation.
Reason: Depreciation represents the fall in the value of fixed assets.
(a) Both Assertion and Reason are true, and Reason is the correct explanation of Assertion.
(b) Both Assertion and Reason are true, but Reason is not the correct explanation of Assertion.
(c) Assertion is true, but Reason is false.
(d) Both Assertion and Reason are false.

Very Short Answer Type Questions

Q1: Define Macroeconomics.

Q2: Give an example of a non-durable good.

Q3: What is an intermediate good?

Q4: Define Investment.

Q5: Explain the concept of Domestic Territory.

Q6: Differentiate between Nominal and Real GDP.

Q7: What is Depreciation in the context of national income accounting?

Q8: Define National Disposable Income.

Q9: What does Personal Income include?

Q10: Explain the Circular Flow in a two-sector economy.

Short Answer Type Questions

Q1: Explain the components of Net Factor Income from Abroad.

Q2: Describe the calculation of Real GDP.

Q3: Differentiate between GDP at Market Price and GDP at Factor Cost.

Q4: Explain the relation between National Product and Domestic Product.

Q5: Describe the concept of Normal Resident.

Q6: Explain the methods of calculation of National Income.

Q7: Describe the components of Personal Income.

Q8: Explain the calculation of National Disposable Income.

Long Answer Type Questions

Q1: Explain the Circular Flow in a Two-Sector Economy with Examples.

Q2: Differentiate Between Nominal and Real GDP with Examples.

Q3: Explain the Methods of Calculation of National Income.

Q4: Describe the Components of Personal Income.