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NATIONAL INCOME

Marshall The lab.& cap. Working on its natural resources produce annually a certain aggregate of commodities material and immaterial including services of all kinds….this is the true national dividend or NI

PIGOU
 PIGOU-INCLUDED

INCOME DERIVED FROM ABROAD (FROM FOREIGN INVESTMENT)  ONLY THOSE WHICH CAN BE MEASURED( exchanged ) IN TERMS OF MONEY

PIGOU IGNORED

Barter Mothers service Marrying your maid servant

FISHER

Consumption is the ultimate Piano or overcoat made for me this year is not part of this Ni rather the services it renders this year is important

KEYNES
Expenditure Approach-

Y=

C

+ I

Factor income approach--

Y =F + Ep

F is the factor income toall like wages interest rent Ep is entrepreneurial profit Sales – cost approach--

Y =A – U

A is Gross national product U is the User cost (dep in use – dep when not in use + exp. On maintainance )

Y=A - U -V
Vis the supplementary cost beyond managerial control like fire obsolescence etc

METHODS OF MEASUREMENT
 Product

method/Value added method
Value of Cost of Value output interme added diate goods ---500 700 1200 500 200 300 1000

producer stage

Farmer Miller Baker total

Wheat 500 Flour 700 Bread 1000 2200

 Value

added = Value of the output – value of intermediate consumption  2200 - 1200 = 1000 , the market value of bread.

Product method
Net value added ,Primary sector(FC) NVA IN secondary sector NVA TERTIARY SECTOR Consumption of fixed capital Ind tax (less) subsidies (-) (FC) (FC) 2000 1100 1000 500 850 150

------------GDP mp (less) ind taxes(850-150) (-) 5300 700 -------------GDPfc (less)consumption of fixed capital (-) 4600 500 --------------NDPfc Net factor income from abroad 4100 100 --------------NNPfc/ National income

4200

Income method Compen to emplyees Interst Rent Profit Mixed income of self employed Indirect tax (less) Subsidies Consumption of fixed capital (-) 1500 600 2000 850 150 500 -------------GDPmp (less) Net ind tax GDPfc (less)con.fixed cap (-) (-) 5300 700 4600 500

-------------NDPfc Net factor incom from abroad 4100 100 ------------------NNPfc/NI 4200

Expenditure method
Pvt.fin.con . Exp Govt.fin.con exp Investment exp Export of G&S (less)imports (-) 3500 600 1300 400 550

--------------GDPmp (less)net ind tax GDPfc (less) con. Of cap goods (-) (-) 5300 700 4600 500

----------------NDPfc Net factor income from abroad 4100 100

----------------NNPfc/NI 4200