Every Book Back multiple-choice question from National Income (12th Standard Economics, Samacheer Kalvi) — each with the correct option highlighted and a clear, worked explanation. Free to read in English and Tamil.
Q1
Net National product at factor cost is also known as
- A. National IncomeCorrect
- B. Domestic Income
- C. Per capita Income
- D. Salary
Explanation. Net National Product at factor cost represents the total income earned by the factors of production of a country, which is the definition of National Income.
Q2
Primary sector is _________
- A. Industry
- B. Trade
- C. AgricultureCorrect
- D. Construction
Explanation. The primary sector of an economy is based on the extraction and harvesting of natural resources, with agriculture being the major component.
Q3
National income is measured by using _________ methods.
- A. Two
- B. ThreeCorrect
- C. Five
- D. Four
Explanation. There are three distinct methods used to calculate national income, namely the product method, the income method, and the expenditure method.
Q4
Income method is measured by summing up of all forms of _________
- A. Production
- B. Taxes
- C. expenditure
- D. IncomeCorrect
Explanation. The income method computes national income by adding up all the incomes generated by individuals and firms in the production process.
Q5
Which is the largest figure?
- A. Disposable income
- B. Personal Income
- C. NNP
- D. GNPCorrect
Explanation. Gross National Product is the largest among these measures because it includes depreciation and is calculated before any deductions for taxes or savings.
Q6
Expenditure method is used to estimate national income in _________
- A. Construction sectorCorrect
- B. Agricultural Sector
- C. Service sector
- D. Banking sector
Explanation. In India, the expenditure method is primarily applied to estimate income from the construction sector by assessing total spending on construction activities.
Q7
Tertiary sector is also called as _________ sector
- A. ServiceCorrect
- B. Income
- C. Industrial
- D. Production
Explanation. The tertiary sector is referred to as the service sector because it provides various essential services to consumers and other industries.
Q8
National income is a measure of the _________ performance of an economy.
- A. Industrial
- B. Agricultural
- C. EconomicCorrect
- D. Consumption
Explanation. National income serves as a comprehensive indicator of the overall economic performance and productive capacity of a nation over a year.
Q9
Per capita income is obtained by dividing the National income by _________
- A. Production
- B. Population of a countryCorrect
- C. Expenditure
- D. GNP
Explanation. Per capita income represents the average income of a person and is calculated by dividing total national income by the total population.
Q10
GNP = _________ + Net factor income from abroad.
- A. NNP
- B. NDP
- C. GDPCorrect
- D. Personal income
Explanation. Gross National Product is calculated by adding the net factor income from abroad to Gross Domestic Product.
Q11
NNP stands for _________
- A. Net National ProductCorrect
- B. National Net product
- C. National Net Provident
- D. Net National Provident
Explanation. NNP stands for Net National Product, which represents the total value of goods and services produced by residents minus depreciation.
Q12
_________ is deducted from gross value to get the net value.
- A. Income
- B. DepreciationCorrect
- C. Expenditure
- D. Value of final goods
Explanation. Depreciation or consumption of fixed capital must be subtracted from gross indicators to derive their corresponding net values.
Q13
The financial year in India is _________
- A. April 1 to March 31Correct
- B. March 1 to April 30
- C. March 1 to March 16
- D. January 1 to December 31
Explanation. The financial year in India runs from April 1st of the current year to March 31st of the following year.
Q14
When net factor income from abroad is deducted from NNP, the net value is _________
- A. Gross National Product
- B. Disposable Income
- C. Net Domestic ProductCorrect
- D. Personal Income
Explanation. Deducting Net Factor Income from Abroad from Net National Product yields Net Domestic Product.
Q15
The value of NNP at production point is called _________
- A. NNP at factor costCorrect
- B. NNP at market cost
- C. GNP at factor cost
- D. Per capita income
Explanation. The value of Net National Product measured at the production point, where factor inputs are paid, is called NNP at factor cost.
Q16
The average income of the country is ….
- A. Personal Income
- B. Per capita incomeCorrect
- C. Inflation Rate
- D. Disposal Income
Explanation. Per capita income represents the average income of a country's citizens, calculated by dividing the total national income by the total population.
Q17
The value of national income adjusted for inflation is called ….
- A. Inflation Rate
- B. Disposal Income
- C. GNP
- D. Real national incomeCorrect
Explanation. Real national income is the nominal national income adjusted for changes in the general price level, reflecting the actual purchasing power.
Q18
Which is a flow concept ?
- A. Number of shirts
- B. Total wealth
- C. Monthly incomeCorrect
- D. Money supply
Explanation. Monthly income is measured over a period of time, making it a flow concept, whereas wealth, shirt stocks, and money supply are measured at a specific point in time.
Q19
PQLI is the indicator of ………………
- A. Economic growth
- B. Economic welfareCorrect
- C. Economic progress
- D. Economic development
Explanation. The Physical Quality of Life Index is designed to measure economic welfare by evaluating standard of living, life expectancy, and literacy rates rather than just monetary growth.
Q20
The largest proportion of national income comes from …….
- A. Private sectorCorrect
- B. Local sector
- C. Public sector
- D. None of the above
Explanation. In many mixed economies, the private sector contributes the largest share of national income compared to the public or local sectors.
