Match the national income aggregates and development indicators listed in List-I with thei… — State PSC Exam

Match the national income aggregates and development indicators listed in List-I with their correct methodological definitions in List-II:

Net National Product at Factor Cost ( $NNP_{FC}$ ) $GDP_{MP} - \text{Depreciation} + \text{Net Factor Income from Abroad} - \text{Net Product Taxes}$
Gross Value Added at Basic Prices ( $GVA_{BP}$ ) $GVA_{FC} + (\text{Production Taxes} - \text{Production Subsidies})$
Planetary Pressures-adjusted Human Development Index (PHDI)Human Development Index discounted by per capita carbon dioxide emissions and material footprint
Genuine Progress Indicator (GPI)Economic metric that adjusts personal consumption expenditure for income inequality, environmental degradation, and non-market benefits

Answer

Net National Product at Factor Cost corresponds to

GDP_{MP} - \text{Depreciation} + \text{NFIA} - \text{Net Product Taxes}

. Gross Value Added at Basic Prices corresponds to

GVA_{FC} + (\text{Production Taxes} - \text{Production Subsidies})

. Planetary Pressures-adjusted HDI corresponds to the Human Development Index discounted by per capita carbon dioxide emissions and material footprint. Genuine Progress Indicator corresponds to the economic metric adjusting personal consumption expenditure for income inequality, environmental degradation, and non-market benefits.

Each national accounting aggregate and indicator is accurately paired with its official definition under CSOS/NSO national account revision standards and UNDP indicator frameworks. Net National Product at Factor Cost represents national income. GVA at Basic Prices isolates production-stage net taxes. PHDI adjusts HDI for environmental footprint, while GPI extends economic progress measurement beyond conventional consumption output.

Step-by-Step Solution

Analyze Net National Product at Factor Cost (

NNP_{FC}

)

NNP_{FC} = GDP_{MP} - \text{Depreciation} + \text{NFIA} - \text{Net Product Taxes}

Converting Gross to Net requires subtracting depreciation; converting Market Price to Factor Cost requires subtracting Net Product Taxes.

Identify the accounting identity for Gross Value Added at Basic Prices (

GVA_{BP}

)

GVA_{BP} = GVA_{FC} + \text{Net Production Taxes}

Basic prices account for production taxes (like land revenue and stamp duties) independent of actual output quantity, while excluding product taxes (like GST).

Evaluate the development indicator definitions

PHDI incorporates environmental strain (carbon emissions and material footprint), whereas GPI expands macroeconomic accounting beyond GDP by incorporating social and environmental welfare adjustments into personal consumption.

Distinguishing global index adjustments (UNDP's PHDI) from alternative welfare accounts (GPI) clarifies their economic measurement focus.

Key Concept

National Income Accounting Identities and Modern Development Indicators

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