Economics (Part – VII)

Total Questions: 50

11. GNP-depreciation allowances = [S.S.C. Online C.P.O.S.I. (T-I) 2.07.2017 (Shift-I)]

(a) National Income
(b) NDP
(c) NNP
(d) GNP

Correct Answer: (c) NNP

Solution:⇒ NNP = GNP- Depreciation

Where,

NNP = Net National Product

GNP = Gross National Product

12. According to the UK government's data, India was the________ largest source of foreign direct investment in the UK during 2019-20. [S.S.C. Online MTS (T-I) 14.10.2021 (Shift-III)]

(a) fifth
(b) fourth
(c) second
(d) third

Correct Answer: (c) second

Solution:According to the UK government's data, India was the second largest source of foreign direct investment in the UK during 2019-20.

13. Which of the following best represents the concept of Net Domestic Product (NDP)? [S.S.C. Online MTS (T-I) 14.10.2021 (Shift-I)]

(a) GDP+Income from abroad
(b) GDP-Income from abroad
(c) GDP-Depreciation
(d) GNP-Depreciation

Correct Answer: (c) GDP-Depreciation

Solution:Net domestic product (NDP) is an annual measure of the economic output of a nation that is adjusted as per the depreciation effect. The NDP is calculated by subtracting depreciation from the gross domestic product (GDP).

14. The only difference between GNP and GDP is that GDP does not include income from________. [S.S.C. Online MTS (T-I) 4.10.2017 (Shift-II)]

(a) Domestic production
(b) Abroad
(c) Steel production
(d) Secondary sector

Correct Answer: (b) Abroad

Solution:The only difference between GNP and GDP is that GDP does not include income from abroad. Gross Domestic Product (GDP) is the aggregate value of goods and services produced within the domestic territory of a country. GDP includes the replacement investment of the depreciation of capital stock.

15. What does GNP stand for? [S.S.C. Online C.G.L. (T-I) 9.03.2020 (Shift-I)]

(a) Gross National Product
(b) Gramin Nisak Praman
(c) Gramin Nigam Parisad
(d) Gross National Produce

Correct Answer: (a) Gross National Product

Solution:GNP stands for Gross National Product. It is the total value of all finished goods and services produced by a country's citizens in a given financial year, irrespective of their location. GNP also measures the output generated by a country's businesses located domestically or abroad.

16. Which of the following identity is correct regarding GNP? [S.S.C. Online CPO SI (T-I) 09.11.2022 (Shift-I)]

(a) GNP GDP + Factor income earned by the domestic factors of production employed in the rest of the world Factor income earned by the factors of production of the rest of the world employed in the domestic economy
(b) GNP GDP Factor income earned by the domestic factors of production employed in the rest of the world - Factor income earned by the factors of production of the rest of the world employed in the domestic economy
(c) GNP GDP + Factor income earned by the domestic factors of production employed in the rest of the world - Factor income earned by the factors of production of the rest of the world employed in the domestic economy
(d) GNP GDP Factor income earned by the domestic factors of production employed in the rest of the world + Factor income earned by the factors of production of the rest of the world employed in the domestic economy

Correct Answer: (c) GNP GDP + Factor income earned by the domestic factors of production employed in the rest of the world - Factor income earned by the factors of production of the rest of the world employed in the domestic economy

Solution:The correct identity regarding GNP is option (C) GNPGDP+ Factor income earned by the domes-tic factors of production employed in the rest of the world Factor income earned by the factors of production of the rest of the world employed in the domestic economy. This is because GNP (Gross Na-tional Product) is the total value of all final goods and services produced by the country's domestic factors of production (owned by the citizens of the country) whether they are located within the country or out-side of it.

17. Which of the following best defines Net National Income? [S.S.C. Online CHSL (T-I) 14.10.2020 (Shift-I)]

(a) NDP-Depreciation
(b) GNP + Depreciation
(c) GNP-Depreciation
(d) GDP-Depreciation

Correct Answer: (c) GNP-Depreciation

Solution:Net National Income is Gross National Income or Gross National Product excluding depreciation. When depreciation is deducted from the GNP, we get Net National Income.

18. Income of the state which arises out of the property left by the people without a legal heir is called ______. [S.S.C. Online CHSL (T-I) 08.06.2022 (Shift-I)]

(a) escheat
(b) writ
(c) de novo
(d) felony

Correct Answer: (a) escheat

Solution:Escheat is a part of non-tax revenue that refers to the government's claim on the property of some de-ceased person who has no legal heir or will for the property left behind. This is a type of revenue for the government.

19. Which of the following gives money to the government resulting in a fiscal deficit? [C.P.O. S.I. 7.06.2016 (Shift-I)]

(a) IMF
(b) RBI
(c) Local Government
(d) Corporate House

Correct Answer: (b) RBI

Solution:The difference between the total income and total expenditure of the government is called fiscal deficit. Fiscal deficit is usually due to decrease in revenue or excessive increase in capital expenditure. The fiscal deficit is usually met by borrowing from the central bank (reserve bank) or by raising funds from the capital market through short-term bonds, long-term bonds and treasury bills.

20. Which method of calculating the national income is also known as 'Industrial Origin Method'? [S.S.C. Online CHSL (T-I) 02.06.2022 (Shift-II)]

(a) Expenditure Method
(b) Income Method
(c) Value Added Method
(d) Monetary Measures Method

Correct Answer: (c) Value Added Method

Solution:The value-added method is also known as the indus-trial origin method. This method is used to measure national income in different phases of production in the circular flow. It shows each producing unit's con-tribution (value added) to the production process.

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