Question : In the product method for measurement of national income, we need to deduct the value of intermediate goods to ____.
Option 1: analyse factors of production
Option 2: avoid over consumption
Option 3: avoid double counting
Option 4: estimate aggregate value of expenditure
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Correct Answer: avoid double counting
Solution : The correct option is to avoid double counting.
In the product method for measuring national income, we need to deduct the value of intermediate goods to avoid double counting. Intermediate goods are those used in the production process and are included in the final product's value. Deducting their value ensures that only the value added at each stage of production is considered, preventing the counting of the same value multiple times in the calculation of national income.
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Question : Which of the following options does not constitute a national income measurement method?
Option 1: Credit method
Option 2: Product method
Option 3: Income method
Option 4: Expenditure method
Question : The GDP estimation method measuring the aggregate value of factor payments is called ______.
Option 1: product method
Option 2: Value added method
Option 3: expenditure method
Option 4: income method
Question : The product method used to calculate the annual value of goods and services produced is also called___________.
Option 1: value added method
Option 2: income method
Option 4: depreciation method
Question : If we deduct depreciation from GNP the measure of aggregate income that we obtain is called _____.
Option 1: Gross domestic product
Option 2: National income
Option 3: Private income
Option 4: Net national product
Question : If we sum the gross value added of all the firms of the economy in a year, we get a measure of the value of the aggregate amount of goods and services produced by the economy in a year. Such an estimate is called ______.
Option 1: Net national product
Option 2: National income at factor price
Option 3: Net value added
Option 4: Gross domestic product
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