Which one of the following statements is not correct for National Income Accounting for India?
Imports are subtracted in calculating Gross Domestic Product.
Net factor payments earned from abroad are included in Gross Domestic Product.
Purchase and sale of second-hand goods are not included in Gross Domestic Product.
Inventories are included in Gross Domestic Capital Formation.
Answer is Wrong!
Answer is Right!
This question was previously asked in
UPSC CDS-1 – 2024
C) Purchase and sale of second-hand goods are not included in GDP as they do not represent current production. Their value was already accounted for in the GDP of the year they were produced.
D) Change in inventories (unsold goods held by firms) is considered as investment (part of Gross Domestic Capital Formation) and is included in GDP calculation as it represents production that occurred within the period.