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    Handwritten critical key notes of national income accounting

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    National Income accounting

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    Handwritten critical key notes of national income accounting

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
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    43 views14 pages

    National Income Accounting

    Uploaded by

    raj
    Handwritten critical key notes of national income accounting

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
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    i Fe ~ cymeTe R_2 — NATTONAL TNCOME ACCOUNTING Anawet Mahe following gyueslions dm _ 18 tenlizncen . ( peta MODUS rravas) . q AQuili & shel mel en She concept 7 tee ae An ftom? that 4 meant pgp will met cas Ahnough any mere ee oe dl anja ao ted A At 4, re fa example, le caret -Poroduein ie gon Bt Jb 0 Ab Aes vl achow the nasi colton undergo Bronfman youn - eae B sold 4 a Fertile mill Avhen, oduuckine paocus, ita trav nfevend Jmle Bs ta me a flusthe convetbeit mls a clus That som Ase russel the altimall coriumet. Her the des & the if Pet de Ile coll Lk as he ie Penta oma it hos hum sold tt ra ry aadion — eemomic St ay fe ond sithen Lnavrafetim en alt the hands , wk may sum diigo ome ae run a Fae ahitmalt Ycoumer. Br ian tea eo ae hy a consumer ba fimal ood bul Jt hos 4% g Unnough a fea makin, puo Jim dhe Pilon ae ue Lt becomes duintable tea. wheuos, th tea a Bold disectly Le the customers att Ph swlowianb” Jevome the fimal good and the fea (ow sases J hecome tthe final Arwie . Shus, Ub | not ton the maltioe of the good but on Ate tonemic mative 4 Ua uae ata goa fecoma & inal aood. Final ood ~ Kam clanified Qh conaumpto Goods and abital goods - ” Gea ain joo , clothi Ahat au Joiumull and jn taps dlimal onsumption au consumption Escnbien cls ee te Purthen sclossi ied Or oe dunrabls ae mon durables Yen Lhe Avasis { ae 3) cel. Capital. goodk imelude machineries, sqyeip at freone vwased Lo Convert row mateial imls Ged pos Se ood, thus yf ave consider jal! Ahe gee Aenvices penne im an &conem ne ve puiiod ime thiy ane 2ithen dm the {ore aie agate Choth disrattand mon durable) 61 “xapital goods. 3 Explain the creular love imcome qan zconom — The ctncul an Ou of Jmcome an one “ahous the mevement imcome between the and households ameluding “the ods 4 senutces, joa Sowi and on fed i She diagram Aclouy oleptcli Kouaitlar Hous 4 dmcome Qn LeOnorny , Spend ds® and or ett od ea ~., 8 a \y [ebm (Coat) JAN ge’ ‘fee te poy nen fodar AOWLER : Jn this simplified economy, vat 1 asturned. that jhe Prousholds Abend thein “embbu smcome on Be gpodk, ard tuweet px oducd. Ly, tha, Cores fo Ah Frewseholel donot save, donot bay tones te "the eee Psa thou & mo govelnment . edn the aliogéiam shown Above, the ubheimost or) the Pousehdds 42 the pons , movin a Ae “3 ending Frouwhelds £6 buy goods and gous produced boy sims. She second axrour me U6 th» households seepaesen t dhe ir hom fa Fe i i provided by firmn tb She frouscholds » Sn shart, Ahe Aw asious viopresenE the uy ymens fol the ods and Avwices and Lhe Plow of goods payime { OS rehiads {eu bayment - # $8 and sevicee The Lower mosh asvious! moving fiom the howehal d te Me finn wf. the Services” that Arouseholds Ose samc fe the fers Usirg, The Avwies, Lhe foutbul. DH osvraw above this, perm manufacture She rm She fins to dhe rowxeholedls Sepousent the the firs be the Frouseholols (6 ths ces providdcl Ahem. Feel haymenls imetuce suwoad foi the foster “of paoducton™ 4p i jt adh ction 43, sunk, slag She ag} gab value ods and enciees oduced (2) Exbend tune meld @ Exbenditue_me - Mecuunring the agguegale ave of all a Apending that: {ums acct final Pood (8 Sences % OD Product methed= Woaurdn the aggngale valut of goods 4 Atnissproducral a in rag 6) Income method = Measuring gumtotal of all focler payments | 3. \Wlsite Qa rele on Ta 81 Hast => Externalities afer : , © tdiel cores Le another Q. frre, Ban donc alized ere avhich uthiy aa vot paid a pire 4 na donot have any. market im whic hie Aught and “sold. : 4 Je, et 44 Srppose Dhee 4 an é Fefimoug ee vod ieee and. alls he oT ae output aefinery ut Lhe @moun| Bit Sp We ee Tata aid woluz ddlded i ‘ Sa suf hoy doducting the walue of entered goods wed 4y the ou fiom Are aqlus q ih otthut, he Malu addel Ahe sufinery will “be Countecl as pont om Ahe Aconemy . But im Corning ouf the eduction = he of ma 0 , Aroke © Bollated ene Stiven - A 0 as Frevm fo the people who Suse “suscaten of “h SEVE - _ Aenea, thein prealth will be olisturtel . Pollution im also fill Ate fish im the siver. Asa sell, “f eshormim = ra, be fosing dhein Livelihood. Such Arcaraful affects awed Ay Ahe Payne i fa uvich Rt val “mot bear any “cosls tdMod” ag zxtemnalities. Jn thir cise , The Gpp ui mot taking, timnlo vaccounl such —megacive ’ exfeinalittes ; : Show com Le cose eilive oxbennalshes ov wsell.: A £ompany Panty ALS Im and anwend i wambus -paroviclin Ih People am that area usith h ain and shelter ut an example 4 positive erfernality. In such cose Gp sill fale the actual xwelf ase 4, The “pconomg.. pen im cose of megative oxternalitis , th for with oveustimale Uhre “actual rwelfore of He > ‘OP ww econ” po fee Aiatrali umplanned accumulation and decumed ation Maat with an example | When thee & ar arexbected Ziales) tre flan wilh shave wmadld ato sods wshich «Lt hack ok omticibated. This i called unplanned. accumulation q imuntees, On th otha ond awh thou vumupuced xise Am The alu, Lhow wil Le unplanned decumulalion develo . | Thi xan Ae Uluubralid with tu help of, | Ah peed example ~ / Subpoe a jor produces shoul. dt Atos | She year aitth on Amventéry 4 Io Ahinl . Duxing | the min an 2% bs Ae iS ofrcng 18 di Xk ogbe dal 1000 shirt, invent ! “the set ae dmventy, loo at tte omd clus: Hh an, Ke pels 4 thi Tram eat ie be aundpuctedly low. She fiom abl t6 sell enly Goo shinls ? This pent tte fm ‘usith J s400 sumsolel hint. eee shee wwith foo +100 =500 shin - sumuxhecteck sutse Anen tees Hoo awit Le om ernpb of tithe Accumulation of dnventertes Lf, on the ether hamd , te salt had ben wm vmée than ooo ue vould drone i Sdlueumulalion of irvomnlindes, Fel eramble, df the “| Bela had hah 1050, thun mol only the productien c fooo jshink will be sold, the finn Zz wal rave Pte sell 50 shinks out f dhs aonventety | & Sd nepectecl suduction in Jmventoia i d | example ef unexpected decurnufation inventetien, tiakk planned accumulation and decumalation 3) ta oe vam xkample planned accumulation amd cumulation « 2? tgs ave anticipated im advance, This scam be Feld avith te help sf following example | | Gubbose She fim susombs ts scube Ahe_ inventor, [oo Shins fs 900 shink duaing the A Enfeetin sales | 1000 shink during” thi yeas, the ert duces [000 +100 = [jo0% shink ; S| the Ags actually lo00 Ahint, thin the fim tracted nds ap Muth a abe Imventortes. The ras stock Jenvnteties 48 00 sho, avhich two Ay Aho fur » This sbe 4 an txample of plnnecl accumu ali’on imventéries « N -plomned On the other Avom ob, if the lnm Dad — avombel £6 sud whe imventate friore Joo fs as thn UE vould peocluee lo0e-15 = 995 sheik . | Tho as Aecause” 2b Hane do Sell Fe bhab out f% 100 Shin it stolid Autth so that The | dnventay ab the ond { the : Aewomes l00 “15: 695 think? uwhtch the filer uwvank , d/ the aales Ja She anon tun oub ‘to. be 1000 as expected. J ; Ae “Powra, ths din wilt be Qu sasith He Manne cl, Yuduced dovenlony of 995. Aho. This is an Pamble d° Glanned. deswmulation 9 arventstics Kaye (ach cyuestion Answer the gatiiatg quale ae PO Henterncey ém | Exbletn the mace economte duis | => The followin @u ome 4 She impaitamt Matio 2conomic. tdentities - J Greis Notional Product CGiNP)= The Wav’ 2conomic ‘rvortalle avhich Jokes imle actounh GipP along woth | the factor Amiome kavrid dy the clomutic fortes Ea + Lmbployed "dn the vat of Lhe adsld minus the dactér “Zmeome Lored. by the faclers. of production Ere saat of Lhe amploydl im. the domestic kconemy 8 called 08 Gross National -Retoduet ‘ Herd. (GiniP = GDP%- Mer focléh imeome frorn abcad ] 3) Net Naboral Preduck Chin A post 4 - gofital: ge Konwamed duising th. on dua te esw0ean amd: ted. “his Sete sarah tas Bs called depreciation, Ashen’ swe deduct debyaciation m GNP te mecnuse f a income, thal ave + Cbtaim + salkd Net Ne bret dwedcct Thus | NNP = Ginp - depreciation 3}, National Income i Net Nabional Bioduel at fools ob » Phe measure oo “agen imcome that a ebtaimed ter eal dia and simdiec’ foxes © and addin up Are Galstclies fom Net Natieral Produc is“ called National Income 6 Net National Pnoduct of foct dt cat. NL (Notfonal Income) = NNPat movtket patces — (Jathuct | Care, ~ Aubsicies 5 andl Jneome CPE) Ean mean Sneome which & romnd am emment » enbeipriser , poet: 4y ta A nea Among Ate %, ft a Bhs veallid, Undisbuilutid j Pon undabistulad pngfis, Corporat stats ok Sa made dy ‘Rewalds Oo. Supe bs im the ir aa andl any Ponape bayer se frore Are pment his a i ie ive at Me Pomonal Joie hus oT pe National Income — Undisbrilulid profil _ 4 Net imteust pay ment made doy Aousholds | KSpdiak tox + Tr poyment® Je the Aoustholols fom the Government and forse 5 Persoral Dis abl drome CPor’ Esco ore swe deduct peuonal, Be poyrnents Ake vand hon tox rents such, as Ce Iriome » 100 deer Personal ‘apadic Fr = Por Indie 2 Non - tay onal diy elle tn pte sashith ? Gils ite to tox poypment a rn a pont he alt take a thodl B & Reid ly oe he of periditurs wmetho f° Imeasusin E most Cony SS che salt poner "sor A ~~ savy caleulaling a county 3 hott, gormmren Adds uh © = 63 The expenchi line Shat the goveunment makes @n the final good anol Zuwies produced by Ae. dam BE?) Ge Shall demok this + G, “~Cd) She exbett Sevenues Amat foun a tan . ty, alg Te Aeneas alaoad — sfhis vill Ae a Pp. u Shu, the tum total g te that th fam tf goomy 4 eee RY; = Sum, total of, final fonsumbtion, icnvestnet, poet and eypei wxpenditives pecaived by its Crt ZT, t Oy ct me. : Sf thuw aw N fins then addiog up al tin N firms vx gat N RV, = Sum total of fiomal comtumbtion , tel Jmvestinent , govreunment and expert Cxhenclitunes ecuivect Ay alt the fers i, Hh oranamu 4 thye av N fn then adding up au = se EN fore oe 9 4.) RV, = Sum total c| fimal Lorirmption , Sveitininl © ovenment and expert Sipe noceivedt Ay alt Bh fins dim mia! T+ 2°G, 73", Goatketrg 2% als final Aonsemphion expenditure at ee ont od Clornestic frame, we at R= EGt T-T4 G-G, 42" | =| 3 jel Aes, (- Cn enoles that post of, aggeg oti consumbhion Spenditure that G spent on the peat fe T- T,, denoles Gtands){a that part of ag apagat dmwaitrnent ex penditure Jhat ia ea dornuatic fisting - Gm on 61° thal: pont 4 as ol be that & ie on, 88 fg sty, denotes agge ate expenditune. a ppreigrass bei 8h the expels the teoneiyieg Substituting the above tqjuation forthe we gel Gor =a RV C+D +tG+x-™ ch exbstesses Gop accérding & the expenditure method . oh 3 Explain a * mumnviical exer fo. ahous that all then methods f astimmaliony Gor ae as the Same auw0t : ‘, => She followin Penn exormple thous Mhat. oll Lhe muthods f silirationg Gor giv us the Same aswet- . Xq° Suppose Thou ‘ese Live Lire , A and®, . FomA uses no ae mmatinted and produc cotton wwduth Re SO. A ells 26 colton Ue fLiim B ) who - vee Us froduce cloth . Finn BY sel, Lhe cat, paocluuced JB corsurrous for Rs 00.0" 1: (alealation of GpP using the walur added method — Valu added = Sales — “4dntoumediate ge Thas YA, = 80-0 =50 YAg oa $00 -5Sa= xe) LGpe = VA, + VAg = Bstin oP She Pollowimg table Shows the disbibutron of GPs {ot opines Ae and: B.. Se Sate sf ay ; ; Fim Ae Finn B | d Bde | 50 Q00 d Anteumecdictl Grsumption © So | Volue added © $0. 150 ns (olewtation GNP uvirng expendite rruthed » ; 2: 72 Sum f ‘mal expenditures en goods amd. &0 “gonvited fe md abe+ dn Lhe above sxambhe ¢ dhe expenditure doy. Konbiarren., on firdl lath =. GOP Calealation suing imrcome methool Te ax consider hat of the Rs 50 sucieved min A, at giver Ps Po ke Hts woeikens Jy : . ao awages, and ups LE aemaimimg 30 a is prokle. Sally B get Go os wages andl uth 4o a haofiB. She followin table shows the olisbibutvons el fost deacons fours A and B | Finn A Fam B | (Wage 0 bork. ao L i 60 Pat 30 “Qo : oad Jmcome method Eur Hotal of ae , sewomes, ashich 8 sqjual ts. total usa aceived hoa) | A and B) and Aolat bags inna C ty. r * B) usher 3B eqjual Je 804+ 1Q0rsQOa, hel Hence, Ub 8 proved. thal retl hue od 4 ation GP give Ahe sare annie . 5} Woate down the Aimttationt ef using Gi0P as an Index gf aselfaxt Ef Ahe “counts aS Gipp ss the «sum totol oolite of goods pnd sewies wcualid within the aphicol Asoundaxr a counts ima pasiticaudar apo Following aw Aame dhe main Limitations ch , esi, “Gor a an simdex of saselfaree of He coun NM Douteibub on GO? = ; 5 Sf the GDP of the counbuy 4 nising , Me ( mot aise Os a comsequinn. Tha és A CLAS ai Aecatse th “tise im GOP may Le conentroled dr the Shands ew Imdlinsduakso fii « Far exemple Buppose im @000, an ireaainon ounliy Bock (a0 dmdividetals 2ach 2aariin Ph IO. Tharefee. Ahe GOP thu scounlay 4003 Rs Jo > (1oox Ie). Sn ool Act us Subbose Lu Jane -couniy shod Ao individiuds “toaning Rs |F and the rut lo imBividuals comin Ps 900 tach. The GOP of the counhy ‘becomes Pu toto ie (Ox t+ ax (0).<81043007'2"" We Obsenve that . Compoued te G0? at Qooo , im Yoo! the GOP Arar imarlased lo. J sve stelate this os the swelfar fhe coroma Then swuly GOP 4 nefa good imbbc as Hhis 2 imeose &-Rsto has habpened ata fst Jo! dendigiieluals dropping their ipnome fom Ra 10 409 “And only 0 mck visliial gee an imoeve tr imtome, (is promt Bs jo’k ag. pmonelon exchanges + ~ ey pe actiottis 4m Ahe economy axe mot f ‘al bem mmonelouty Jems. Fei exarnple, the s cust gen oren fn a ire ie roti mer exchanges | Oe also mol mae Os ak os fF po abl fn devefopion oun 1, Chu. Me sn andndleve opecl mpi pohwu. bavitr exchan ttl lou but ue gurenall mot counteat joe GioPs 4 Aounbibs - yi us the case | andeutination Gor. Henu, GOP caludaled im Itondand! mannet ay mol give wa kar indicalion S 4 productive acti viles and wl sheiong fa counbiy J | 7 Exteanaleties Jalen the Lerelits ot aan a fre Ban amdividucl couse 46 ano fer. which Shay ane mol paid él penalined - There “on Awa nave externality Ae an oil suflaery polluting the ynemby aiver and

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