Raising national income is the important goal of all economic activity. Economic welfare of a country depends upon what goods and services are available for the consumption of its individuals. The changes in national income statistics show how the economy is developing and enables the government to lay down the appropriate economic policy necessary under the circumstances. The following are the main uses of national income.
Full Answer According to the Library of Economics and Liberty, national income accounting, when taken together with population data, can be used to measure the well-being of a country through per capita income as well as growth over time.
Together with labor-force data, national income accounting can also be used to assess the growth and level of economic productivity.
On the same note, it can also be used as a guide for providing an inflation policy, especially if used with monetary and financial data. There are five main components of national income accounting.
These include production, capital accounts, consumption, foreign transactions and government transactions. The production account deals with the business sector of the economy and comprises all firms of production, such as trading and manufacturing.
Consumption accounts refer to the receipts and payments of the household sector, which consists of nonprofit organizations and consumers. However, the government account reflects the inflows and outflows of the government.
Capital accounts show that there is an equilibrium between foreign and domestic investment, while foreign accounts show various transactions between a country and other countries of the world. · Gross national income is the sum of a nation's gross domestic product and the net income it receives from kaja-net.com://kaja-net.com · CfIAPTEk 1 Concept of National Income i National Income an Appraisal Notion NATIONAL income may be defined as the net value of all economic goods produced by the kaja-net.com · National income accounting, a set of principles and methods used to measure the income and production of a country.
There are basically two ways of measuring national economic activity: as the money value of the total production of goods and services during a kaja-net.com Contents 1 National Income 2 Definition 3 The Importance of National Income 4 Measure methods 5 The Limits of Measuring National Income 6 Online Database 7.
National Income:The sum total of factor of incomes accruing to the residents of the country, both from their activities within and outside the economic territory is the national income of the kaja-net.com://kaja-net.com · National Income Estimation becomes very important because of the various methods involved in it.
One can go about measuring "NI", based on the Income Earned by an kaja-net.com › Social Science › Economics.