increases in prices of the shares of a company we can add in national income tl me plzz
Answers
Explanation:
Some of the major items whether included or excluded in national income are as follows:
1. Construction of a new house.
Yes, it will be included in the national income as it is a part of capital formation and leads to production of goods and services in the economy.
2. Winning of a lottery prize.
No, it will not be included in the national income as it does not add to the flow of goods and services in the economy.
3. Increase in the prices of stocks lying with a trader.
No, it will not be included in the national income as it does not amount to any flow of goods.
4. National debt interest.
OR
Interest on public debt.
No, it is not included in the national income as it is the interest paid on loans taken by government to meet its consumption purposes.
5. Rent-free house given to an employee by an employer.
Yes, it is included in the national income by Income Method since it is a part of ‘wages in kind’ paid to employees.
6. Profit earned by foreign banks in India.
No, it is not included in the national income as it is a part of the factor income paid abroad. It is subtracted from domestic income to get national income.
7. Purchases by foreign tourists
Food purchased by a foreign tourist at a hotel in New Delhi.
Yes, purchases by foreign tourists are ‘exports’ and, therefore, they are included in the national income through the Expenditure Method.
8. Rent received by Indian residents on their buildings rented out to foreigners in India.
Yes, it will be included in the national income as it is a part of the factor income from abroad.
9. Payment of fees to a lawyer engaged by a firm.
It is an intermediate expenditure for the firm because it involves purchase of services by one production unit (firm) from another production unit (lawyer). So, it is deducted from the value of output of the firm to arrive at the value added. So, it is not included in national income.
10. Free medical facilities by the employer.
OR
Free boarding and lodging provided to a domestic servant.
Yes. It will be included in national income as these free services are part of compensation to employees.
11. Gifts received from abroad.
OR
Gift received from employer.
National income as gifts received are transfer incomes.
12. Profits of Reliance Industries from its chemicals business in Australia.
Yes, it will be included in the national income as it is a part of the factor income from abroad.
13. Salaries received by Indian residents working in Russian Embassy in India.
Yes, it will be included in the national income as it is a pan of factor income from abroad
14. Subsidized lunch served to workers in a factory.
OR
Firm incurred expenditure on medical treatment of employee’s family.
Yes, it is a part of the compensation of employees and, therefore, it will be included in the national income.
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