Will the following be included in the national income of India ? Give

1.	Will the following be included in the national income of India ? Give reasons for your answer.(a) Financial assistance to flood victims (b) Profits earned by the branches of a foreign bank in India (c) Salaries of Indians working in the American Embassy in India
Answer» (a) Financial assistance to flood victims: No, this will not be included in the national income as it is a transfer income. (b) Profits earned by the branches of a foreign bank in India: No, the profits will not be a part of the national income of India. They are subtracted from the domestic income to get the national income. (c) Salaries of Indians working in the American Embassy in India: Yes, the salaries will be a part of the national income as they are factor income from abroad.

Will the following be included in the national income of India ? Give reasons for your answer.(a) Financial assistance to flood victims (b) Profits earned by the branches of a foreign bank in India (c) Salaries of Indians working in the American Embassy in India

Answer»

(a) Financial assistance to flood victims:

No, this will not be included in the national income as it is a transfer income.

(b) Profits earned by the branches of a foreign bank in India:

No, the profits will not be a part of the national income of India. They are subtracted from the domestic income to get the national income.

(c) Salaries of Indians working in the American Embassy in India:

Yes, the salaries will be a part of the national income as they are factor income from abroad.

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