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Mirgank Tirkha
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10 views2 pages

Presentation 1

Uploaded by

Mirgank Tirkha
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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The National Income Accounts of Eepnagar

Exhibit II: Product/ Value-Added Method


Firm Value of Product Value-Added Blank

Wheat farmer Value of wheat produced = 572 Value added by wheat farmer = 452
(Kisan) (i.e., 572 – 120)

Flour mill Value of flour produced = 1000 Value added by flour = 360
(Malik) mill (i.e., 1000 − 520 −120 )

Bread Bakery Value of flour made into bread = Value added by bakery (i.e., = 500
(Rotiwala) 1500 1500 − 1000)
Total Operating Surplus (1.1) = 1312
Total Operating Surplus from Other Goods Produced (Mistry) = 200
(1.2)
Total Compensation to Employees (2) (labour and secretary, i.e., 120 = 240
+ 120)
Gross Value Added (1.1 + 1.2 + 2) = 1752
The National Income Accounts of Eepnagar

Exhibit II: Expenditure Method


Consumption (in cowries) Investment (in cowries)

Bread consumed 1100 Capital goods


accumulation:

Capital goods consumed 200


(tools + oven door)

Inventory
accumulation:

 in wheat inventory 52
(= 220*2.6 – 520)

 in wheat inventory 400


(=375*4 – 1100)

Consumption (C) 1100 Investment (I) 652

GDP at Market Price = C + I = 1100 + 652 = 1752

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