From the following data, calculate Personal Income and Personal Disposable Income.
Rs (crore)
(a) Net Domestic Product at factor cost 8,000
(b) Net Factor Income from abroad 200
(c) Undisbursed Profit 1,000
(d) Corporate Tax 500
(e) Interest Received by Households 1,500
(f) Interest Paid by Households 1,200
(g) Transfer Income 300
(h) Personal Tax 500
Personal Income = NDPFC + Net factor income from abroad (NFIA) + Transfer Income – Undistributed profit – Corporate tax – Net interest paid by households
NDPFC = Rs.8000 crores
NFIA = Rs.200 crores
Transfer Income = Rs.300 crores
Undistributed profit = Rs.1,000 crores
Corporate tax = Rs.500 crores
Net interest paid by households = Interest paid - Interest received
= 1200 - 1500
= (-) Rs.300 crores
So, putting the values in the above formula
PI = 8000 + 200 + 300 - 1000 - 500 - (- 300)
= 8000 + 200 + 300 - 1000 - 500 + 300
⇒ PI = 7300
So, Personal Income = Rs.7300 crores
Personal Disposable income = Personal Income - Personal Payment
= 7300 - 500
= Rs. 6800 crores
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