Question

Profit earned by an indian bank from its branches abroad.State whether it will inckude in national income and why?

Answer 1

Yes it will include the national income bcause if the people in abroad even come and use the bank the bank will even get profit from that and hence they will get an increase in national income

Answer 2

Profit earned by an Indian bank from its branches abroad is included in national income as it forms a part of the factor income that comes from abroad.

* National income refers to the value of all the goods and services produced in a given country in a period of one year.

* The net factor income from abroad is taken into consideration whereas depreciation of the fixed capital assets are deducted.

* Different methods for calculating national income are:

1. Production

2. Income

3. Expenditure.