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National Income Accounting
Question
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Giving reason, explain how are the following treated in estimating national income by income method. 
(i) Interest on a car loan paid by an individual.
(ii) Interest on a car loan paid by a government-owned company.

Answer

(i) Interest will be included in national income if car is meant for production purposes but will not be included if car is for consumption purposes.
(ii) Interest will be included in national income because government-owned company is supposed to use car for rendering productive services.

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Some More Questions From National Income Accounting Chapter

Briefly explain the following basic concepts related to NI:
 National Income (NI).

Briefly explain the following basic concepts related to NI:
Final Goods and Intermediate Goods. 

Briefly explain the following basic concepts related to NI:
Consumption Goods and Capital Goods

Briefly explain the following basic concepts related to NI:
Flow and Stock Concepts

Briefly explain the following basic concepts related to NI:
Gross Investment and Net Investment

Briefly explain the following basic concepts related to NI:
Domestic (Economic) Territory

Briefly explain the following basic concepts related to NI:
Normal Residents

Briefly explain the following basic concepts related to NI:
National Income at Current and Constant Prices (Nominal and Real NI).

Briefly explain the following basic concepts related to NI:
Consumption of Fixed Capital (Depreciation).

Briefly explain the following basic concepts related to NI:
Factor Cost vs. Market Price (or Net Indirect Taxes)