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35. INCOME METHOD
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EXPENDITURE
METHOD
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1.
Meaning
The
national income is calculated on the basis of income distributed to the
factors of production.
2.
Formula
National
Income = Rent + Wages + Interest + Profit
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The national income is calculated on the
basis of private and public
expenditure on consumption goods/services and on
non consumption goods (saving)
National
income = Private Consumption and Investment + Public (government) Consumption
and
Investment.
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INCOME METHOD EXPENDITURE METHOD
