ECONOMICS II

Assignment no.one

National income Accounting; Discuss.

Define National income. National income referee to the government book-keeping system that
measures the health of an economy, projected growth, economic activities and development during
certain preoid of time.

National income of any country means the complete value of the goods and services produced by any
country during financial year.

Mention and explain the concept of National income. The

concept of national income explain the facts about economic activities.

Following are concept of National income with explanation. 1. Gross

domestic product (GDP) at market price: is money value of all goods and services produced within the
domestic domain with the available resources during a year.

2. Gross national product (GNP): is market value of final goods and services produced in a year the
residents of the country.

3. Net national product (NNP) at market price: is market value of net output of final goods and services
produced by an economy during a year and net factor income from abroad.

4. National income (NI): is also known National income at factor cost which means total income earned
by resources for their contribution of land, labour and capital.

5. Personal income (PI): Is the total income received by individuals and households of a country from all
possible sources before direct taxes.

6. Disposable income (DI): It is the income left with the individuals after the payment of direct taxes
from personal income. It's actually income that can be spent for consumption by individuals.

7. Per capita income (PCI): it is calculated by dividing the national income of the country by the total
population of a country.

Methods for measurement of National income: methods of estimating national income of a country
depends upon the availbility of proper statistics. There are three methods for measuring national
income.

1. Product method: the production method mearues national income as sum of net products produced
by the production unit in the given period. It involves the following steps. - Identifying
the production unit. - Estimating their
net products. In this
method, national income is measured as a flow of goods and services. We calculate money value of all
goods and services produced in an economy during the year.

2. Income method: under this method, national income is measured as a flow of factors of production
LA our, capital, land and entrepreneurship.

3. Expenditure method: in this method, national income is measured as a flow of expenditure. Gross
domestic product is sum-total of private consumption expenditure.

Functions of National income Accounting: to determine the economic status of a country. To provide
basis of evaluation and reviews of policies that under Implementation.

Importance of National income Accounting: the statistics provided by national income accounting can be
used to simplify the procedures and techniques used to measure the aggregate input and output of an
economy. National income accounting provides information on the trend of economic activity level.
Central Banks Can use the national income accounting statistics to vary the rate of interest. The national
income accounting data also shows the contribution of different sectors, to wards economic growth.

Problems of measuring national income accounting: there are many difficulties to measure national
income.

Double counting: it's one of the major problem in the calculation of national income. It is refer to a
commodity being included in the national income more than once.

Change in value of money (price level): the value of money keeps on changing with time because of
changes in the price level. This create problem to calculate national income.

Illegal income: Are income earned through activities such as gambling, bribery and smuggling.

Non-market activities: there are Many activities which do not appear in the market, these activities are
not included in the calculation of national income.

Unreported income: sometimes, people don't provide all informations about their income inorder for
them to avoid taxes.

Choice of method: It is difficult to decide which method is to be used in the calculation of national
income.

Calculation of depreciation: the depreciation is deducted from gross product to calculate net national
product and national income.

Reference: National income

is derived from gross domestic product at factor cost by two main adjustments. First, capital
consumption has to be subtracted; this s an estimate of the amount that would have to be spent on
replacement investment to keep the Nation's capital stock unchanged.

UNIVERSITY OF JUBA
SCHOOL OF BUSINESS AND MANAGEMENT SCIENCE

DEPARTMENT OF PUBLIC ADMINISTRATION

FIRST YEAR: (2021-2022)

GROUP D (4) ATTENDANCE.

O1. Atem Simon Atem peter 19-HRP-021

02. Alier Deng Sammy. 19-HRP-014

03. Achier Atak Achier 19-HRP-004

04. Abalo Lily Rose 19-HRP-001

05. Akook Dut Yel 19-HRP-012

06. Bol Akuei Akuei 19- HRP-032

07. Billy William Hassan 19-HRP-028

08. Chol Mangong manyuon 19-HRP-040

09. Clement Mark Joseph 19-HRP-045

10. Daniel Angok Yel Ariarh 19-HRP-048

11. Emmanuel Anyuon Bak Angok 19-HRP- 075

12. Jackson Aru Majok Ajang 19- HRP-099

13. JIdiet Choung Dak 19-HRP-111

14. Jenneier James Adok 19-HRP-110

15. Joseph Aleu Kusch 19-HRP-349

16. James Ngong Diing 19-HRP-107

17. Joh Lual Ngor 19-HRP-112

18. Kharbino Ngong Noon Wol 19-HRP-129

19. Manor Maker Riak 19-HRP-151

20. Mary Alfred Simon