--%>

Estimating rational income

How will you treat the given in estimating rational income of India? Provide reasons for your answer.

(i) The value of bonus shares received by the shareholders of a company.
(ii) Interest received on loan provided to a foreign company in India.

E

Expert

Verified

(i) This is not comprised in national income since it is the return of financial capital and not of goods & services.

(ii) This is comprised in the national income as interest is a factor income and a portion of domestic income.

   Related Questions in Macroeconomics

  • Q : Changing value of multiplier ‘Over the

    ‘Over the precedent 30 years, and particularly as our entry into the EU, imports (and exports) as a proportion of GDP have increases considerably in the UK. What influence has this had on the value of multiplier in the UK?’

  • Q : Explain Shut Down Price Explain the

    Explain the term Shut Down Price? Illustrate it.

  • Q : How Bank rates control the credit How

    How Bank rates control the credit? Answer: Bank rate is the rate of interest at which the Central bank lends to Commercial banks. By increasing the bank rate centra

  • Q : Macroeconomics-fiscal and monetary

    1) How can governments seek to control their national economies through fiscal and monetary policies?2) What are the causes of the fiscal deficits experienced by many developed nations in the past three years and what are the main effects

  • Q : Market shift when exporting When the

    When the U.S. furniture market is primarily in equilibrium at point e on S0D0 and then Chinese manufacturers start exporting more furniture to the United States, then this market would shift towards a new equilibrium at: (1) point a. (2) point b. (3) point c. (4) poin

  • Q : Problem on full employment level of

    What happens when AD > AS past to full employment level of employment?

  • Q : Microeconomics is studying economic

    is studying economic worth your time and effort

  • Q : Decisions at the Margin The least

    The least apparent illustration of how decisions are generally ‘at the margin’ would be: (i) Purchasing an additional novel after learning that all paper-backs at Borders are on sale for 25 percent off. (ii) Tossing a 6-year old cousin to the deep end of t

  • Q : Utilization of Bond market to make and

    How does the FED utilize the bond market to make and destroy money? Which technique do developed countries utilize to decrease the chance of experiencing inflation? What about the Banana Republicans and inflation, do they have this means acessible to

  • Q : Fiscal Monetary changes With the

    With the general equilibrium framework in place, the stage is now set for introducing fiscal and monetary changes and analysing their effects on the general equilibrium. We will first introduce a fiscal change in the form of increase in deficit-financed expenditure, a