National Income Accounting Class 12 MCQ Quiz – Test Your Understanding!

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Are you ready to test your knowledge of National Income Accounting from the Class 12 Economics syllabus? This chapter is crucial for understanding how a country measures its economic performance through GDP, GNP, NNP, and other national income aggregates.

About the Quiz

Chapter Name: National Income Accounting
Subject: Economics
Book: NCERT Class 12 Economics
Question Type: Multiple Choice Questions (MCQs)
Leaderboard: Yes (Check Your Rank!)

Why Take This Quiz?

✔ Helps in CBSE board exam revision
✔ Strengthens understanding of GDP, NDP, GNP, NNP, and per capita income
✔ Enhances problem-solving and calculation skills
✔ Track your progress with the leaderboard

Click Below to Start the Quiz!

Chapter 1-National Income Accounting

1 / 15

Flow of Goods & services and factors of production across different sectors in a barter economy is known as _____.

Circular flow

Capital flow

Real flow

Monetary flow

2 / 15

In the expenditure method, GDP at market price (GDPmp) is calculated as:

PFCE + GFCE + NIT – Subsidies

PFCE + GFCE + Depreciation + NFIA

PFCE + GFCE + Net Investment – Exports

PFCE + GFCE + GDCF + Net Exports

3 / 15

Inventory is a _____ concept whereas the change in inventory is a _____ concept.

stock, flow

flow, stock

flow, flow

stock, stock

4 / 15

Which of the following is a flow variable?

Population at a given point

Money supply

Stock of capital

National income

5 / 15

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Why are intermediate goods excluded from the calculation of national income?

They are imported goods

They are not sold in the market

They are not produced within the domestic territory

Their value is already included in the value of final goods

6 / 15

In the circular flow of income in a two-sector economy, what flows from households to firms?

Consumption expenditure

Factor services

Factor payments

Profits

7 / 15

Match the Concept with its Example or Characteristic:

Column A	Column B
A. Flow Variable	1. Stock of capital at a point in time
B. Stock Variable	2. Bread consumed by a household
C. Final Good	3. National income over a year
D. Operating Surplus	4. Rent + Interest + Profits

A – 3, B – 1, C – 4, D – 2

A – 1, B – 3, C – 2, D – 4

A – 3, B – 1, C – 2, D – 4

A – 3, B – 2, C – 1, D – 4

8 / 15

Match the Income Aggregate with its Adjustment:

Column A	Column B
A. GDPmp to GDPfc	1. Subtract personal taxes and non-tax payments
B. GNPmp to NNPmp	2. Subtract depreciation
C. PI to PDI	3. Subtract indirect taxes + Add subsidies
D. NDPfc to NNPfc	4. Add Net Factor Income from Abroad

A – 3, B – 1, C – 2, D – 4

A – 3, B – 2, C – 4, D – 1

A – 1, B – 2, C – 3, D – 4

A – 3, B – 2, C – 1, D – 4

9 / 15

Gross National Product (GNP) differs from Gross Domestic Product (GDP) because it includes:

Net Factor Income from Abroad (NFIA)

Subsidies

Indirect taxes

Depreciation

10 / 15

The GDP deflator is calculated as:

(Nominal GDP / Real GDP) × 100

Real GDP + Nominal GDP

Nominal GDP – Real GDP

(Real GDP / Nominal GDP) × 100

11 / 15

Also See: CBSE Class 12 Science 90-Day Study Plan 2027: Toppers' Strategy to Score 95%+

Read the following figure carefully and choose the correct pair from the alternatives given below:

national income class 12 important questions answers

Output, production

Output, disposition

Value added, production

Wealth, development

12 / 15

Which of the following should be excluded while calculating national income to avoid double counting?

Value added by firms

Net exports

Value of final goods

Value of intermediate goods

13 / 15

Which of the following goods is classified as a final good?

Wheat sold by a farmer to a mill

Bread purchased by a household for consumption

Flour purchased by a bakery for making bread

Machinery parts used in assembling a tractor

14 / 15

The formula for converting GDP at market price (GDPmp) to GDP at factor cost (GDPfc) is:

GDPmp + Depreciation

GDPmp – Net Factor Income from Abroad

GDPmp – Indirect Taxes + Subsidies

GDPmp + Indirect Taxes – Subsidies

15 / 15

Assertion (A): Net Investment equals Gross Investment minus Depreciation.
Reason (R): Depreciation represents the increase in the stock of capital goods over time.

A is true, but R is false.

Both A and R are true, but R is not the correct explanation of A.

Both A and R are true, and R is the correct explanation of A.

A is false, but R is true.

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Key Topics Covered in the Quiz

✔ Concepts of GDP, GNP, NNP, NDP
✔ Factor cost vs. market price
✔ Methods of national income calculation (Income, Product, Expenditure)
✔ Real vs. Nominal GDP
✔ Limitations of GDP as a growth measure

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