What precautions should be taken while estimating national income… - Vidyadip

Question

What precautions should be taken while estimating national income by expenditure method? Explain.

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Answer

Expenditure on purchase of second hand goods should not to be included because the value of goods was counted when they were new.
Imputed expenditure on own account output to be included because it results from production activity.
Expenditure on financial assets should not be included because it does not lead to creation of any good or service.

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