Question
Giving reasons explain whether the following are included in national income.
(i) Profits earned by a branch of foreign bank.
(ii) Interest paid by an individual on a loan taken to buy a car.
(iii) Expenditure on machines for installation in a factory.
Solution
(i) Not included in national income of India as it is earned by a foreign bank.
(ii) Not included because loan is not taken for productive purpose.
(iii) It is included when measured by expenditure method as it is final investment expenditure.
