Question

precautions of expenditure mathod while estimate National income
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Answer 1

Answer:

Expenditure on only final goods and services should be included in the national income estimation while intermediate consumption expenditure should not be included.

Similarly, expenditure on the purchase of second hand goods should not be included in the national income estimation of the current accounting year.

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Answer 2

Explanation:

Expenditure on only final goods and services should be included in the national income estimation while intermediate consumption expenditure should not be included.

Similarly, expenditure on the purchase of second hand goods should not be included in the national income estimation of the current accounting year.

(i) Do not include expenditure on transfer payment. (ii) Do not include expenditure on purchase of financial assets. (iii) Do not include expenditure on purchase of second hand goods. (iv) Do, not include expenditure on intermediate goods. Precaution: (i) Expenditure on intermediate goods should not be included, only expenditure on final goods should be included. (ii) Estimated expenditure on production for self consumption should be included. (iii) Transfer of payments should not be included. (iv) Expenditure on financial assets should not be included