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

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

Value of final goods

Value of intermediate goods

Value added by firms

Net exports

2 / 15

In the value-added method, the value added by a firm is calculated as:

Value of output – Value of intermediate goods

Gross Investment – Net Investment

Sales – Depreciation

Value of output + Value of intermediate goods

3 / 15

Intermediate goods are always durable in nature.

True

False

4 / 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 false, but R is true.

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

A is true, but R is false.

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

5 / 15

Also See: CBSE Class 12 Biology Sample Paper with Solutions PDF Download

Personal Disposable Income (PDI) is derived from Personal Income (PI) by:

Subtracting personal taxes and non-tax payments

Adding transfer payments

Subtracting net factor income from abroad

Adding corporate taxes

6 / 15

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

national income class 12 important questions answers

Value added, production

Output, disposition

Output, production

Wealth, development

7 / 15

If in an economy the value of Net Factor Income from Abroad is Rs. 200 crores and the value of Factor Income to Abroad is Rs. 40 crores. Identify the value of Factor Income from Abroad.

Rs. 160 crores

Rs. 200 crores

Rs. 240 crores

Rs. 180 crores

8 / 15

Assertion (A): GDP may overestimate welfare if negative externalities like pollution are ignored.
Reason (R): GDP includes non-monetary transactions and barter exchanges.

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.

A is true, but R is false.

9 / 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 – 2, C – 4, D – 1

A – 3, B – 1, C – 2, D – 4

A – 1, B – 2, C – 3, D – 4

A – 3, B – 2, C – 1, D – 4

10 / 15

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For a closed economy (with no foreign trade), which one of the following is correct?

GDP < GNP

GDP + GNP = 0

GDP > GNP

GDP = GNP

11 / 15

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

Indirect taxes

Subsidies

Net Factor Income from Abroad (NFIA)

Depreciation

12 / 15

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

PFCE + GFCE + GDCF + Net Exports

PFCE + GFCE + NIT – Subsidies

PFCE + GFCE + Depreciation + NFIA

PFCE + GFCE + Net Investment – Exports

13 / 15

The GDP deflator is calculated as:

(Nominal GDP / Real GDP) × 100

(Real GDP / Nominal GDP) × 100

Nominal GDP – Real GDP

Real GDP + Nominal GDP

14 / 15

Which of the following is a flow variable?

Stock of capital

Money supply

National income

Population at a given point

15 / 15

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

Flour purchased by a bakery for making bread

Bread purchased by a household for consumption

Wheat sold by a farmer to a mill

Machinery parts used in assembling a tractor

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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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