explain the importance of data in following areas (i) economic planning (ii) National income determination
Answers
Answer:
National income estimates give us detailed data relating to a country's production, savings, investment, capital formation and various other economic activities in a particular year. All these data give us a comprehensive picture of the economic activities of the people during that year.
Answer:
In economic planning: The data of the previous years are generally used to
prepare future plan. For example, if we have to plan expenditure to be incurred on
primary education for a year, data regarding number of students who were enrolled
up to class fifth in previous years and the expenditure incurred during those years
is important to look at. Forecasting is done on the basis of economic planning. For
example, if we want to predict the growth of per capita income of a country, the data
on the growth rate of population and the national income are also to be collected
and considered.
2. To determine national income:In order to know the state of our economy it is
important to know the national income besides various other things. But national
income can be determined by using certain methods which require quantitative
information on various things such as wages and salaries received by workers, rent
received for use of land and building, interest received for use of funds and profit
earned by the entrepreneurs in the economy in the given year.
Explanation: