From the following data relating to a firm
(a) estimate the net value added at market prices
(b) show that the net value added at factor cost is equal to the sum of factor income :

Explanation

`GVO_(MP)=` Sales + Change in stock
= Domestic sales + Exports + Increase in stocks
`=1080+120+120`
`= Rs 1320` thousand
`GDP_(MP)=GVO_(MP)-` Intermediate consumption
`=GVO_(MP)-` (Domestic purchases + Import of Raw material)
`=1320-(360+60)=1320-420`
`= Rs 900` thousand
(a) `NDP_(MP)=GDP_(MP)-"Dep."`
`=900-45`
`= Rs 855` thousand
(b) To prove that `NVA_(FC)=` Sum of factor income
(i) `NVA_(FC)` or `NDP_(FC)=GDP_(MP)-"Dep."-NIT`
`=GDP_(MP)-"Dep."-` [Indirect taxes - subsidies]
`=900-45-(30-0)=900-45-30`
`= Rs 825` thousand ...(i)
(ii) Sum of factor income
`=COE+OS+MI`
=(Salaries + Wages)+(Rent + Interest + Dividend + Undistributed Profits)+MI
`=360+(45+270+90+60)+0=360+465+0`
`= Rs 825` thousand ...(ii)
From (i) and (ii) : `NDP_(FC)//NVA_(FC)=` Sum of factor income