{"id":90829,"date":"2025-06-01T10:38:31","date_gmt":"2025-06-01T10:38:31","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=90829"},"modified":"2025-06-01T10:38:31","modified_gmt":"2025-06-01T10:38:31","slug":"suppose-an-indian-citizen-makes-an-investment-abroad-and-earns-a-posit","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/suppose-an-indian-citizen-makes-an-investment-abroad-and-earns-a-posit\/","title":{"rendered":"Suppose an Indian citizen makes an investment abroad and earns a posit"},"content":{"rendered":"

Suppose an Indian citizen makes an investment abroad and earns a positive return on her investment. Which of the following is correct ?<\/p>\n

[amp_mcq option1=”Her income is part of India’s GDP, but not part of India’s national income.” option2=”Her income is part of India’s national income, but not part of India’s GDP.” option3=”Her income is part of both India’s GDP and national income.” option4=”Her income is neither part of India’s GDP, nor its national income.” correct=”option2″]<\/p>\n

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This question was previously asked in<\/div>\n
UPSC CAPF – 2023<\/div>\n<\/div>\n
Download PDF<\/a>Attempt Online<\/a><\/div>\n<\/div>\n
\nGross Domestic Product (GDP) measures the total value of goods and services produced *within the geographic boundaries* of a country during a specific period. Gross National Income (GNI), often referred to historically as Gross National Product (GNP), measures the total income earned by the *residents* of a country, regardless of where the income is earned. GNI = GDP + Net Factor Income from Abroad (NFIA). NFIA is the difference between factor income (like wages, profits, interest, dividends) earned by residents from abroad and factor income paid to non-residents for their contributions within the country. Income earned by an Indian citizen on an investment abroad is factor income earned by a resident from outside India. This income contributes to India’s national income (GNI) but is not part of India’s GDP as it was generated outside the country’s borders.
\n<\/section>\n
\n– GDP measures production within geographical boundaries.
\n– National Income (GNI\/GNP) measures income earned by residents, regardless of location.
\n– Income earned by residents from abroad is part of National Income but not GDP.
\n<\/section>\n
\nFor many developed countries with significant foreign investments or income from citizens working abroad, GNI is typically higher than GDP. For countries with substantial foreign investment within their borders or many non-residents earning income domestically, GDP may be higher than GNI. The transaction described is a positive component of NFIA for India.
\n<\/section>\n","protected":false},"excerpt":{"rendered":"

Suppose an Indian citizen makes an investment abroad and earns a positive return on her investment. Which of the following is correct ? [amp_mcq option1=”Her income is part of India’s GDP, but not part of India’s national income.” option2=”Her income is part of India’s national income, but not part of India’s GDP.” option3=”Her income is … <\/p>\n

Detailed SolutionSuppose an Indian citizen makes an investment abroad and earns a posit<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1085],"tags":[1105,1120,1174],"class_list":["post-90829","post","type-post","status-publish","format-standard","hentry","category-upsc-capf","tag-1105","tag-economic-development","tag-national-income-gross-domestic-product","no-featured-image-padding"],"yoast_head":"\nSuppose an Indian citizen makes an investment abroad and earns a posit<\/title>\n<meta name=\"description\" content=\"Gross Domestic Product (GDP) measures the total value of goods and services produced *within the geographic boundaries* of a country during a specific period. Gross National Income (GNI), often referred to historically as Gross National Product (GNP), measures the total income earned by the *residents* of a country, regardless of where the income is earned. GNI = GDP + Net Factor Income from Abroad (NFIA). NFIA is the difference between factor income (like wages, profits, interest, dividends) earned by residents from abroad and factor income paid to non-residents for their contributions within the country. Income earned by an Indian citizen on an investment abroad is factor income earned by a resident from outside India. 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