ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The four components of gross domestic product are personal consumption, business investment, government spending, and net exports.

Detailed explanation-2: -GDP = GDP at market price – depreciation + NFIA (net factor income from abroad) – net indirect taxes. Income Approach : The Income approach of GDP calculation is based on the total output of a nation with the total factor income received by residents or citizens of a nation.

Detailed explanation-3: -The calculation of a country’s GDP encompasses all private and public consumption, government outlays, investments, additions to private inventories, paid-in construction costs, and the foreign balance of trade. (Exports are added to the value and imports are subtracted).

Detailed explanation-4: -GDP Formula GDP = private consumption + gross private investment + government investment + government spending + (exports – imports). GDP is usually calculated by the national statistical agency of the country following the international standard.