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Real national income means the national income measured in terms of. 
  • a)
    Constant prices
  • b)
    Current prices
  • c)
    Wholesale prices
  • d)
    Retail prices
Correct answer is option 'A'. Can you explain this answer?
Verified Answer
Real national income means the national income measured in terms of.a)...
goods and services produced in a year are valued at fixed prices, i.e., prices of the base year, we get national income at constant prices. Constant prices refer to the prices prevailing in the base year. A base year is a carefully chosen year which is a normal year free from price fluctuations. (In India now 2004-2005 is treated as base year.)

For instance, if goods and services produced during the year 2008-2009 are valued at the prices of the base year [i.e., 2004-2005), it will be called national income at constant prices for the year 2008-2009. Evidently, it is change in volume of physical output produced during the year which affects national income at constant prices because prices remain fixed (constant).
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Real national income means the national income measured in terms of.a)Constant pricesb)Current pricesc)Wholesale pricesd)Retail pricesCorrect answer is option 'A'. Can you explain this answer?
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