Saturday, 9 November 2019

Unit 14: Calculation of National Income

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                                Unit 14: Calculation of National Income  



There are three different methods of measuring national income.

These are product approach, income approach and expenditure approach.

Under product approach, the sum of net value of goods and services produced at market prices is found.

Income approach is also known as the income-distributed method.

According to this method, the incomes received by all the basic factors of production used in the production process are summed up.

Expenditure method is known as the final product method.

Under this method, the total national expenditure is the sum of the expenditure incurred by the society in a particular year.

In India, the national income estimates are prepared by the Central Statistical Organisation.

Expenditure approach: The total national expenditure is the sum of the expenditure incurred by the society in a particular year.

Government expenditure: The sum of expenditure on consumption and capital goods by the government.

Income approach: The incomes received by all the basic factors of production used in the production process.

Product approach: The sum of net value of goods and services produced at market prices.







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