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Question
State whether the following items will be included in the estimation of National Income or not: Give a reason for your answer.
Government expenditure on street lighting.
Solution
Government expenditure is included in national income because it is part of the Expenditure Method.
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RELATED QUESTIONS
An economy is in equilibrium. Find investment expenditure :
National income =1200
Autonomous consumption expenditure=150
Marginal Propensity to consume =0.8
Answer the following question.
From the follow ing data, calculate GNPMP and NNPFC by Expenditure Method.
| (i) Mixed-income of self-employed | 450 crores |
| (ii) Compensation of employees | 550 crores |
| (iii) Private final consumption expenditure | 1000 crores |
| (iv) Net factor income from abroad | -20 crores |
| (v) Net indirect taxes | 150 crores |
| (vi) Consumption of fixed capital | 170 crores |
| (vii) Net domestic capital formation | 380 crores |
| (viii) Net exports | -30 crores |
| (ix) Profits | 400 crores |
| (x) Rent | 150 crores |
| (xi) Interest | 200 crores |
| (xii) Government final consumption expenditure | 550 crores |
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