Question : Assertion: Gross National Disposable Income (GNDI) measures the total income available to the residents of a country for consumption and savings.
Reason: Gross National Disposable Income (GNDI) is calculated by subtracting net indirect taxes from Gross National Product (GNP).
Option 1: Both Assertion and Reason are true, and the Reason is the correct explanation of the Assertion.
Option 2: Both Assertion and Reason are true, but the Reason is not the correct explanation of the Assertion.
Option 3: Assertion is true, but the Reason is false.
Option 4: Assertion is false, but the Reason is true.
Correct Answer: Both Assertion and Reason are true, and the Reason is the correct explanation of the Assertion.
Solution : The correct answer is (a) Both Assertion and Reason are true, and the Reason is the correct explanation of the Assertion.
The Assertion is true. Gross National Disposable Income (GNDI) does measure the total income available to the residents of a country for consumption and savings. It represents the income that individuals and households have at their disposal after deducting taxes but including subsidies and transfers.
The Reason is also true and serves as the correct explanation for the Assertion. Gross National Disposable Income (GNDI) is indeed calculated by subtracting net indirect taxes from Gross National Product (GNP). Net indirect taxes represent the difference between indirect taxes and subsidies. By deducting net indirect taxes from GNP, GNDI is obtained, which reflects the total income available for consumption and savings by the residents of a country.
Therefore, Both Assertion and Reason are true, and the Reason is the correct explanation of the Assertion.
Question : Assertion: Net National Disposable Income (NNDI) represents the income available to the residents of a country for final consumption and savings.
Reason: Net National Disposable Income (NNDI) is obtained by subtracting net indirect taxes and depreciation from Gross National Disposable Income (GNDI).
Question : Assertion: Personal Disposable Income (PDI) represents the income available to individuals for consumption and savings after deducting personal income taxes.
Reason: Personal Disposable Income (PDI) is calculated by subtracting personal savings from personal income.
Question : Assertion: Disposable income is always greater than personal income.
Reason: Disposable income represents the amount of income available to individuals after paying personal income taxes.
Question : Assertion: National income at factor cost is obtained by deducting net indirect taxes from national income.
Reason: Net indirect taxes represent the difference between indirect taxes and subsidies.
Question : Assertion: Gross National Product (GNP) includes the value of goods and services produced by domestic residents within and outside the country.
Reason: GNP measures the total output of goods and services generated by the factors of production owned by a country's residents, regardless of their location.
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