Question
How the following are treated in estimating national income (NI)? Give reasons.
(i) Services of owner occupied houses, (ii) Sale of shares, (iii) Production for selfconsumption, (iv) Old age pension, and (v) Wealth tax (or income tax).
Solution
Solution not provided.
Tips: -
Hint. (i) Imputed rent of owner occupied houses is included. (ii) Not included in NI because shares are just paper titles which do not contribute in production directly. (iii) Its imputed value is included in NI as it is result of production activity. (iv) Not included because it is paid on account of old age and not for rendering productive service. (v) Not included because it is a compulsory transfer payment.
