Answer to Question #213293 in Macroeconomics for Ashima Gupta

Question

Q1.Calculate Domestic income and National Income from the

following data using Income Method

ItemsRs Crores

Wages10000

Rent and Loyalty5000

Interest400

Profits and dividends3000

MixedIncome4000

Social Security Contribution400

Corporate Gain Tax400

UndistributedProfits200

Net Income earned from abroad1000

Ans:

Domestic income= 19800 Crores

National Income= 20800 Crores

Answer 1

Domestic income is the sum of income received by all the sectors of the economy within the state.

Domestic income=(Wages+ Rent and Loyalty+ Interest Profits and dividends+ Mixed Income+ Social Security Contribution+ Corporate Gain Tax+ Undistributed Profits)

Domestic income=10000+5000+400+3000+4000+200+400

Domestic income=23000 Crores

National income =Domestic income+ Net income earned from abroad

National income =23000+1000

National income =24000 Crores