National Income: " A National Income estimate measures the volume ofcommodities and services turned out during a given period counted without duplication." Thus National Income measures the net value of goods and services in the country.The following are the importance of Calculating National Income.,
To see the economic development of the country.
To assess the developmental objectives.
To know the contribution of the various sectors to National Income.
Concept Of National Income:
The following are the various concepts of National Income.,
1. Cross National Product(GDP): It refers to the money value of total output or production of final goods and services produced by the nation of a country during a given period of time say for example 1 Year. From this definition let us find the calculation of GNP.,
GNP = Money Value of total output or production of final goods and services produced.
GDP + (X-M) where GDP = Total money value of all Goods and services producedwithin the boundaries of the nation(C+I+G).
so, Consumer spending(C) + Investments on Assets(I) + Government Spending(G) +(X(Income earned and received by nationals within boundaries) - M(Money paid byIndia or Income received by Other nationals from the country)) GNPAs GNP stands for Gross figure of national income in must include all the capital investments(GDP) and also revenue incomes(X) and the relevant revenue payments too to be deducted out of the total figure of GDP and X. Now the Gross figure of national income is derived.
Net National Product:
Net National Product is a mostly Revenue nature of Income which will show the net income after the expenses and losses on the capital goods.
NNP = GNP - Depreciation on Capital Stock Consumption
National Income:
Now, let us calculate National Income.,
National Income = NNP - Net Indirect Taxes
= NNP - (Indirect Taxes - Subsidies)
= National Income.The National Income above derived is nothing but NNP only, but after the above calculation the NNP is at its Factor cost. Before the calculation it is at Market Cost. When NNP is derived at Factor Cost then it becomes National Income.
After being elected, U.S. President Jimmy Carter first used Zero-based budgeting to balance the federal budget and reform the federal budgeting system.
After being elected, U.S. President Jimmy Carter first used Zero-based budgeting to balance the federal budget and reform the federal budgeting system.
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