To convert GDP at market prices (GDP_MP) to GDP at factor cost, Net Indirect Taxes (NIT) must be subtracted from GDP_MP . This conversion reflects the removal of indirect taxes and the addition of subsidies, thereby showing the actual income received by factors of production.

Net National Product at Factor Cost (NNP_FC) using the Income Method is calculated by summing up all factor incomes. This includes Compensation of Employees, Rent, Interest, Profit, and Mixed Income. Profit is further divided into Corporate Tax, Dividend, and Undistributed Profit .

The main components of the Gross Domestic Product (GDP) according to the expenditure method are Consumption (C), Investment (I), Government Expenditure (G), and Net Exports, which is calculated by subtracting Imports (M) from Exports (X). Thus, the expenditure method formula for GDP at market prices is GDP_MP = C + I + G + (X - M).

Personal Income is derived from Private Income by considering deductions like Corporate Tax and Undistributed Profit. Private Income itself comprises Factor Income in the private sector and Transfers . Therefore, while National Income focuses on the total factor revenues within the economy, Personal Income specifically measures the income available to individuals after certain corporate deductions.

Net National Disposable Income is calculated by adding Net Indirect Taxes, Net Current Transfers from the Rest of the World (ROW), and Net National Product at Factor Cost (NNP_FC). It includes additional elements beyond NNP_FC, which are the tax adjustments and the contributions or remittances from foreign entities, reflecting the total resources available to the economy.

An increase in Closing Stock over Opening Stock results in a positive Change in Stock, contributing to a higher Value of Output. In the Value Added Method, the Gross Value Added at Market Price (GVA_MP) is calculated as the Value of Output minus Intermediate Consumption, where the Value of Output includes Sales plus the Change in Stock . Therefore, a higher Closing Stock increases the GVA_MP.

Net Factor Income from Abroad (NFIA) is the difference between the income residents earn from overseas and the income foreigners earn within the domestic economy. In the national income calculation, NFIA is added to Domestic Income to reflect total national income as NFIA bridges the gap between purely domestic economic activity and the wider international economic interaction, converting Domestic into National Income .

The Value Added Method calculates GDP by determining the Gross Value Added at Market Price (GVA_MP), which is the Value of Output minus Intermediate Consumption. This method involves direct valuation of production and services in the economy. In contrast, the Expenditure Method calculates GDP by adding up all expenditures made in an economy over a period, i.e., GDP_MP = C + I + G + (X - M). The former focuses on the production side, while the latter emphasizes aggregate demand or spending in the economy.

Private Income constitutes Factor Income from the private sector plus Transfer Payments. It differs from Personal Income as the latter is derived by subtracting Corporate Taxes and Undistributed Profits from Private Income . This distinction highlights the economic resources directly available to individuals versus those circulating in the private sector at large.

Calculating National Income at market price involves summing up economic outputs valued at prices paid by consumers, inclusive of indirect taxes. For factor cost calculation, indirect taxes are subtracted while subsidies are added to reflect the income received by factors of production before tax. These distinctions are significant as they determine how accurately the income distribution to factors of production is represented versus consumer cost realities .