MCQ
National Accounts MCQ - Practice Questions with Answers
Solve 73 National Accounts questions for RAS/RPSC preparation.
Practice questions
Q1Consider the following statements: 1. Gross Domestic Product is a measure of production activity. 2. Gross Value Added is obtained by adding the value of inputs used up in production to the value of output. 3. Net Domestic Product is obtained by deducting Consumption of Fixed Capital from GDP. 4. For GDP, a resident unit has predominant economic interest in the economic territory of the country for one year or more, irrespective of nationality or legal status. Which of the statements given above are correct?
Statement 1 is correct: GDP measures production activity. Statement 2 is incorrect: GVA is output less input used up in production, not output plus input. Statement 3 is correct: NDP equals GDP less CFC. Statement 4 is correct: the resident-unit test is based on predominant economic interest for one year or more, not nationality.
Q2Consider the following statements regarding improvements in the new GDP series: 1. The new series improves compilation of the private corporate institutional sector by segregating activities in multi-activity enterprises. 2. Double deflation is used in the agriculture and manufacturing sectors. 3. The pro-rata benchmarking method has replaced the Proportional Denton method. Which of the statements given above are correct?
Statements 1 and 2 are correct. Statement 3 reverses the source: the Proportional Denton method replaced the earlier Pro-Rata method, not the other way round.
Q3Consider the following statements: 1. Nominal GDP is also called GDP at current prices or GDP in value. 2. Nominal GDP is better suited than real GDP for comparing output over time because it excludes price changes. 3. Real GDP requires adjustment of nominal GDP for price changes. Which of the statements given above are correct?
Statement 1 is correct: nominal GDP is GDP at current prices or in value. Statement 2 is incorrect: nominal GDP is less suited for comparisons over time because changes may reflect prices and PPPs, not only real growth. Statement 3 is correct because real GDP adjusts nominal GDP for price changes.
Q4Consider the following statements regarding final expenditure and GDP expenditure components: 1. Final expenditure consists only of exports less imports. 2. Final expenditure consists of final consumption expenditure and gross fixed capital formation. 3. In the expenditure approach, GDP includes final consumption expenditures, gross capital formation and exports less imports. Which of the statements given above are correct?
Statements 2 and 3 are correct. Statement 1 is incorrect because final expenditure is defined as final consumption expenditure plus gross fixed capital formation; the expenditure approach to GDP also accounts for exports less imports.
Q5Consider the following statements: 1. Gross National Income is obtained by adding net compensation of employees and property income received from the rest of the world to the overall income measure of the economy. 2. In a closed economy, savings equal capital formation during the year. 3. Net National Disposable Income is obtained by subtracting net taxes on income and wealth receivable from abroad from Net National Income. 4. In National Accounts terminology, National Income is the same as Gross National Income. Which of the statements given above are correct?
Statement 1 is correct. Statement 2 is correct. Statement 3 is incorrect because NNDI adds, rather than subtracts, the listed net receivables from abroad. Statement 4 is incorrect because National Income is NNI, not GNI.
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6Consider the following statements: 1. For production-method measurement, value added is counted without duplication by excluding inputs of raw materials and services. 2. The production method estimates product as the sum of value added across industrial sectors. 3. The income method excludes wages and salaries from factor shares. 4. Under the income method, mixed income of the self-employed is one of the income components. Which of the statements given above are correct?
7Consider the following statements: 1. The Central Statistics Office under MoSPI regularly compiled National Accounts aggregate estimates for the economy as a whole and for the public sector. 2. Quick estimates in the NAS 2010 overview were released for the financial year ending March of the preceding year. 3. Advance estimates are released after the close of the year with a time lag of ten months. 4. Part-I of NAS 2010 contained summary statements including GDP, NDP, GNI, NNI, CFC, PFCE, GFCE, exports, imports, capital formation and savings. Which of the statements given above are correct?
8Consider the following statements regarding the 2011-12 base-year national accounts back series: 1. The base year was revised from 2004-05 to 2011-12 in January 2015. 2. The revision incorporated recommendations of the 2008 System of National Accounts. 3. The 2011-12 series measures GVA and NVA at basic prices and GDP at market prices. 4. The revised series avoided use of MCA-21 company filings. Which of the statements given above are correct?
9Consider the following statements regarding selected improvements in the 2022-23 base-year GDP series: 1. PFCE estimates were improved by adopting COICOP 2018 classification and using survey and administrative data sources. 2. PFCE estimates were improved by abandoning survey and administrative data sources. 3. Reduced discrepancy was achieved by excluding the Supply and Use Table framework. 4. Quarterly national accounts in the new series make extensive use of GST and new administrative data sources. Which of the statements given above are correct?
10Consider the following statements regarding sectoral GVA growth in the 2023-24 First Advance Estimates: 1. At constant prices, construction recorded 10.7 per cent growth. 2. At constant prices, manufacturing recorded 8.9 per cent growth. 3. At current prices, public administration, defence and other services recorded 13.8 per cent growth. 4. At current prices, agriculture, livestock, forestry and fishing recorded 8.0 per cent growth. Which of the statements given above are correct?
11Consider the following statements regarding the First Advance Estimates for 2023-24 at constant 2011-12 prices: 1. GDP was estimated at Rs. 1,71,78,641 crore. 2. GVA growth was estimated at 6.9 per cent. 3. PFCE accounted for 58.5 per cent of GDP. 4. GFCF accounted for 34.9 per cent of GDP. Which of the statements given above are correct?
12Consider the following statements on approaches to GDP measurement: 1. GDP can be measured by production, income and expenditure approaches. 2. Production-approach GDP measures value added within the country's territory and adds indirect taxes minus subsidies on products. 3. Income-approach GDP is the sum of compensation of employees, gross operating surplus and gross mixed income, but excludes taxes net of subsidies on production. 4. In India's National Accounts Statistics, production-approach GDP is considered firmer. Which of the statements given above are correct?
13Consider the following statements regarding GDP as a macroeconomic indicator: 1. GDP is a standard measure of the value of final goods and services produced by a country during a period. 2. GDP is a good measure of a societyтАЩs progress or well-being. 3. GDP combines production carried out in a countryтАЩs economic territory during a given period. Which of the statements given above are correct?
14Consider the following statements: 1. In production accounts, gross value added is output minus intermediate consumption. 2. Intermediate consumption is added to output to obtain gross value added. 3. GDP from production excludes product taxes less subsidies not included in output valuation. Which of the statements given above are correct?
15Consider the following statements: 1. The new National Accounts series uses 2022-23 as the base year. 2. The earlier GDP series had 2011-12 as the base year. 3. The 2026 revision reduced coverage of the digital economy, informal sector and gig work. Which of the statements given above are correct?