Answer to Question #118477 in Economics for Setor

Question

Discuss the importance of national income Statistics and state the difference between national income at market price and national income at factor cost.

Answer 1

National Income statistics provides information on the country’s economic performance over a period of time to be used for making economic policies or budgeting or planning.

The market value of the national product exceeds the income paid to the factors of production by the amount of indirect taxes. Hence, net national income at factor cost shows the income actually received by the factors of production.