What are the different measures of national income?
Furthermore, what are the three methods of measuring national income?
The national income of a country can be measured by three alternative methods: (i) Product Method (ii) Income Method, and (iii) Expenditure Method. 1. Product Method: In this method, national income is measured as a flow of goods and services.
Beside above, what are the difficulties in the measurement of national income? Lack of Availability of Adequate Statistical Data 5. Value of Inventory Changes 6. The Calculation of Depreciation 7. Difficulty of Avoiding the Double Counting System 8.
Hereof, why is national income measured in different ways?
There are method of measuring National Income because First National Income is generated through Production (Value addition) and Total value addition in the economy is national income. To produce goods and services Producer needs raw material, labor, capital and land.
What are the types of national income?
5. Major Classes of National Incomes:
- Wages and Salaries: These are called income from employment since these represent that part of the value of production which is attributed to labour.
- Gross Trading Profits:
- Capital Consumption Allowance:
- Income of the Self-Employed:
- Imputed Income: