Calculate Domestic Income (NDP_FC) from the data given below : Define Net Factor Income from Abroad (NFIA) and discuss its components. S. No. | Particulars | Amount (in Rs. lakh) (i) | Gross National Product at market price | 2,500 (ii) | Consumption of fixed capital | 200 (iii) | Goods and Services Tax | 20 (iv) | Subsidies | 50 (v) | Net Factor Income from Abroad | 50 (vi) | Changes in Stocks | 30 (vii) | Unexpected loss of a fixed asset | 500

Question

Accepted Answer

Calculation of Domestic Income (NDP_FC):

NDP_FC = GDP_MP - Depreciation - Net Indirect Taxes
Or: NDP_FC = Compensation of Employees + Operating Surplus + Mixed Income

Net Factor Income from Abroad (NFIA):

Definition: The difference between factor income earned by residents from abroad and factor income earned by foreigners within the country.

Components:
1. Factor income earned by residents from abroad
   - Wages and salaries earned abroad
   - Interest and dividends from foreign investments
   - Profits of foreign branches of domestic companies

2. Factor income earned by foreigners within the country
   - Wages paid to foreign workers
   - Interest and dividends paid to foreign investors
   - Profits of domestic branches of foreign companies

NFIA = Factor income from abroad - Factor income to abroad