National Income – Multiple Choice Questions (MCQs)

1. 1. What is National Income?

   • A. Total revenue of the government
   • B. Total expenditure of the government
   • C. The total value of all final goods and services produced by a country's residents in a year
   • D. The total savings of all individuals in a country

2. 2. Which of the following is a method of measuring National Income?

   • A. Import-Export Method
   • B. Budgetary Method
   • C. Expenditure Method
   • D. Fiscal Policy Method

3. 3. What does GDP stand for?

   • A. Gross Domestic Product
   • B. General Development Program
   • C. Government Development Plan
   • D. Gross Department Product

4. 4. What is the difference between GDP and GNP?

   • A. GDP includes income from abroad
   • B. GNP does not; GNP includes income from abroad
   • C. GDP does not; GDP and GNP are the same; GDP measures only goods
   • D. GNP measures goods and services

5. 5. What is Net National Product (NNP)?

   • A. GDP plus depreciation
   • B. GNP minus depreciation
   • C. GDP minus net exports
   • D. GNP plus net exports

6. 6. National Income at factor cost is also known as?

   • A. GDP
   • B. GNP
   • C. NNP
   • D. NDP

7. 7. What is Personal Income?

   • A. National Income minus taxes
   • B. Income received by individuals and households before direct taxes
   • C. Income after all deductions
   • D. Disposable income plus savings

8. 8. What is Disposable Income?

   • A. Personal Income plus direct taxes
   • B. Personal Income minus direct taxes
   • C. National Income minus indirect taxes
   • D. Personal Income minus savings

9. 9. What is Per Capita Income?

   • A. Total National Income multiplied by population
   • B. Total National Income divided by population
   • C. Total population divided by National Income
   • D. Average savings per person

10. 10. Which sector is NOT included in the calculation of National Income?

    • A. Primary Sector
    • B. Secondary Sector
    • C. Tertiary Sector
    • D. Informal Sector (unrecorded)

11. 11. What is 'value added' in the context of National Income?

    • A. The total value of output
    • B. The cost of raw materials
    • C. The difference between the value of output and the value of intermediate consumption
    • D. The sum of profits of all firms

12. 12. Double counting is a problem in which method of National Income calculation?

    • A. Expenditure Method
    • B. Income Method
    • C. Product (Value Added) Method
    • D. All of the above