To determine the change in real income per capita, we calculate the per capita income for each year. In 2005, it was $120,000 / 1,000 = $120. In 2006, it was $160,000 / 1,100 = $145.45. The increase is $145.45 - $120 = $25.45. Rounding to the nearest whole number provided in the options, the increase is approximately $25.

Disposable personal income is the amount of money that households have available for spending and saving after income taxes have been deducted from their total personal income. It represents the actual purchasing power of individuals. It is calculated by subtracting personal tax payments and certain non-tax payments to the government from personal income, providing a clearer picture of household economic welfare.

Aggregate output refers to the total quantity of final goods and services produced by an economy in a given period. It is a fundamental macroeconomic measure often used interchangeably with real Gross Domestic Product (GDP). It reflects the total productive capacity and economic activity generated by all sectors within the national boundaries.

GNP per capita is defined as the total Gross National Product divided by the total population. To express $300 million in numerical form, we write 300,000,000. Dividing this total by the population of 9,700 provides the average GNP per person. Option C correctly identifies the arithmetic operation required to derive this specific economic indicator.

GDP is calculated based on the market value of final goods and services. In this scenario, the shoes are the final product sold to the consumer for Rs500. The costs of intermediate inputs like leather and thread are already embedded in the final price and are not added separately to avoid double-counting.

Net taxes are defined as the total amount of tax revenue collected by the government from households and firms, minus the total amount of transfer payments (such as social security, unemployment benefits, or subsidies) distributed back to them. This figure represents the actual net flow of funds from the private sector to the public sector, which is a critical component in calculating disposable income and aggregate demand.

GNP is the total market value of all final goods and services produced by the residents of a country, regardless of where the production occurs. It includes private consumption, investment, government spending, and net exports. Per capita income is a derived metric calculated by dividing GNP by the total population; it is an outcome, not a component used in the calculation of GNP itself.

Nominal GDP is calculated using current prices. An increase in nominal GDP could be caused by an increase in the quantity of goods produced (real output), an increase in the price level (inflation), or a combination of both. Without knowing the change in the price level, we cannot definitively determine if real output has increased, decreased, or remained constant.

Gross National Product (GNP) is an estimate of total value of all the final products and services turned out in a given period by the means of production owned by a country's residents. It includes income earned by citizens abroad but excludes income earned by foreigners within the domestic borders.

GDP represents the total market value of all final goods and services produced within a country's geographic borders during a specific time period. It measures the economic activity occurring within the territory, regardless of whether the factors of production are owned by domestic residents or foreign entities. This distinguishes it from GNP, which focuses on the output of a country's citizens.