Question

Q1. Which out of following is not correct:
a.Expenditure on purchase of second-hand goods is excluded from the national income accounting.
b.Employees of international organizations are considered as residents of the country to which they belong
c. Imputed rent of owner occupied houses is excluded from the process of national income accountingd
d. Capital gains are excluded from the process of national income accounting ​

Answer 1

Answer:

A). Expenditure on the purchase of second hand goods should not be included in the national income estimation of the current accounting year. This is because it has already been included in the national income of the accounting year in which these goods were originally purchased.

B). They can be deemed unfair as countries with a higher percentage voting power have the right to veto any decision that is not in their favor.

c). Money received by government from sale of a public sector firm to a private owner. No, it will not be included in the national income because receipts from the sale of secondhand goods are by virtue of transfer of an already existing object. 29. Imputed rent of self occupied houses.

d)No, capital gains will not be included in the national income as they do not add to the current flow of goods and services in the economy.

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