1.

Explain any two precautions to be taken while calculating national income by income method.

Answer»

The following precautions are to be taken while measuring National Income by Income Method : – 

-Transfer earning should not be included in National income, such as old age pensions, unemployment allowances, pocket money, scholarship etc. (because they don't contributes in production process). 

– Income form illegal activities should not be included in the National income such as smuggling, theft, gambling etc. (Because they are illegal). 



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