Calculate the value of Nominal Gross Domestic Product (GDP) for a hypothetical economy. The values of Real Gross Domestic Product (GDP) and Price Index are given as Rs. 1,000 crores and 250 respectively. Giving valid reasons explain, which of the following will not be included in the estimation of National Income in India ? (i) Purchase of shares by an investor in the Bombay Stock Exchange. (ii) Salaries paid to Russians working in Indian Embassy in Russia. (iii) Imputed rent of self occupied houses.

Question

Accepted Answer

Given: Real GDP = Rs. 1,000 crores, Price Index = 250

Nominal GDP = (Real GDP x Price Index) / 100
= (1,000 x 250) / 100
= Rs. 2,500 crores