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According to Simon Kuznets, what is national income?
- a)The total value of goods and services produced within a country's borders.
- b)The net output of commodities and services reaching consumers within a year.
- c)The income earned by a nation's government.
- d)The income earned by foreign residents working in a country.
Correct answer is option 'B'. Can you explain this answer?
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According to Simon Kuznets, what is national income?a)The total value ...
Understanding National Income According to Simon Kuznets
National income is a crucial concept in economics, particularly in the measurement of a nation’s economic performance. Simon Kuznets, an influential economist, defined it specifically to reflect the economic activities that contribute to the welfare of a nation.
Definition of National Income
- National income is defined as the net output of commodities and services that reach consumers within a specific time frame, typically a year. This definition underscores the importance of consumption in gauging economic health.
Components of National Income
- Goods and Services: It encompasses all final goods and services produced for consumption, excluding intermediate goods to avoid double counting.
- Net Output: The term "net" indicates that depreciation of capital goods is accounted for, ensuring that only the value added during production is measured.
Importance of Option B
- Focus on Consumption: This definition emphasizes the flow of goods and services to consumers, highlighting the economy's role in fulfilling consumer needs.
- Economic Indicator: National income serves as a key indicator for policymakers and economists to assess economic activity and growth, guiding decisions on fiscal and monetary policy.
Contrast with Other Options
- Option A may refer to Gross Domestic Product (GDP), which includes total production without accounting for depreciation.
- Option C focuses solely on government income, while Option D involves foreign residents' earnings, neither of which provides a holistic view of national income.
In summary, option B accurately captures the essence of national income as defined by Kuznets, focusing on the net output reaching consumers, thereby serving as a vital measure of economic activity.
National income is a crucial concept in economics, particularly in the measurement of a nation’s economic performance. Simon Kuznets, an influential economist, defined it specifically to reflect the economic activities that contribute to the welfare of a nation.
Definition of National Income
- National income is defined as the net output of commodities and services that reach consumers within a specific time frame, typically a year. This definition underscores the importance of consumption in gauging economic health.
Components of National Income
- Goods and Services: It encompasses all final goods and services produced for consumption, excluding intermediate goods to avoid double counting.
- Net Output: The term "net" indicates that depreciation of capital goods is accounted for, ensuring that only the value added during production is measured.
Importance of Option B
- Focus on Consumption: This definition emphasizes the flow of goods and services to consumers, highlighting the economy's role in fulfilling consumer needs.
- Economic Indicator: National income serves as a key indicator for policymakers and economists to assess economic activity and growth, guiding decisions on fiscal and monetary policy.
Contrast with Other Options
- Option A may refer to Gross Domestic Product (GDP), which includes total production without accounting for depreciation.
- Option C focuses solely on government income, while Option D involves foreign residents' earnings, neither of which provides a holistic view of national income.
In summary, option B accurately captures the essence of national income as defined by Kuznets, focusing on the net output reaching consumers, thereby serving as a vital measure of economic activity.
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According to Simon Kuznets, what is national income?a)The total value ...
Simon Kuznets defined national income as "the net output of commodities and services flowing from the country's productive system to the ultimate consumers within a year," focusing on actual output reaching consumers.
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According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer?
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According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer?.
According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for According to Simon Kuznets, what is national income?a)The total value of goods and services produced within a country's borders.b)The net output of commodities and services reaching consumers within a year.c)The income earned by a nation's government.d)The income earned by foreign residents working in a country.Correct answer is option 'B'. Can you explain this answer?.
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