Calculate the value of Net Value Added at Factor Cost (NVA_FC) : Distinguish between Net Factor Income from Abroad (NFIA) and Net Exports (X – M). S. No. | Particulars | Amount (In Rs. crore) (i) | Operating Surplus | 3,740 (ii) | Increase in unsold stock | 600 (iii) | Sales | 10,625 (iv) | Purchase of raw materials | 2,625 (v) | Consumption of fixed capital | 500 (vi) | Subsidies | 400 (vii) | Indirect taxes | 1,200

Question

Accepted Answer

NVA_FC = Value of Output - Intermediate Consumption - Depreciation

Given:
- Operating Surplus = 3,740
- Increase in unsold stock = 600
- Sales = 10,625
- Purchase of raw materials = 2,625
- Consumption of fixed capital = 500
- Subsidies = 400
- Indirect taxes = 1,200

Value of Output = Sales + Change in Stock = 10,625 + 600 = 11,225
Intermediate Consumption = Purchase of raw materials = 2,625
Depreciation = Consumption of fixed capital = 500

NVA_FC = 11,225 - 2,625 - 500 = Rs. 8,100 crore

NFIA vs Net Exports:
NFIA = Factor income received from abroad - Factor income paid abroad (national concept)
Net Exports = Exports - Imports (domestic concept, includes non-factor services)