Lesson eLearning

The current Gross Domestic Product (GDP) of India is Rs 200 lakh crore. The secondary sector (manufacturing and construction) contributes 23% of the GDP. The contribution of the secondary sector is expected to grow at a compounded rate of 5% per year. What will be the projected monetary contribution of the secondary sector to GDP after 2 years? Give your answer in Rs lakh crore, rounded to two decimal places.

hard 4 marks Class 10 · Economics · Sectors of the Indian Economy
Answer
Rs 50.72 lakh crore (approx.)

The correct answer is Rs 50.72 lakh crore (approx.) — State the final answer.

Step-by-step solution

  1. Calculate the present monetary contribution of the secondary sector: 23% of Rs 200 lakh crore = 0.23 × 200 = Rs 46 lakh crore.
  2. Apply the compound growth formula for two years: Future value = Present value × (1 + growth rate)^n.
  3. Substitute the values: Future value = 46 × (1 + 0.05)^2.
  4. Compute the growth factor: (1.05)^2 = 1.1025.
  5. Multiply: 46 × 1.1025 = 50.715 lakh crore.
  6. Round the result to two decimal places: Rs 50.72 lakh crore.
  7. State the final answer.
Common mistake: Applying the 5% growth to the total GDP instead of only to the secondary‑sector share.

Concept tested: Sectoral growth projection

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