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Q74 (IAS/2013) Economy › Basic Concepts & National Income › National income aggregates Answer Verified

The national income of a country for a given period is equal to the

Result
Your answer: —  Â·  Correct: D
Explanation

National income is defined as the total value of all final goods and services produced by an economy within a specific accounting period [3]. It represents the aggregate of factor incomes earned by the normal residents of a country, including wages, rent, interest, and profit [3]. While Gross Domestic Product (GDP) measures the market value of output produced within a country's domestic territory, National Income (often equated with Net National Product at factor cost) focuses on the monetary value of finished goods and services produced by a country's citizens [2]. Option 4 is the most accurate general definition as it specifies the 'money value' and 'final' nature of the goods and services, which is essential to avoid double counting intermediate transactions. Option 1 is partially correct but typically refers specifically to Gross National Product (GNP) rather than the broader concept of national income [2].

Sources

  1. [1] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 1: National Income > NATIONAL INCOME > p. 3
  2. [3] https://gacbe.ac.in/pdf/ematerial/18MCO12C-U5.pdf
  3. [2] Indian Economy, Nitin Singhania .(ed 2nd 2021-22) > Chapter 1: National Income > POTENTIAL GDP > p. 9
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