NATIONAL INCOME

National Income - Module 1

Introduction to National Income

1.1 What is National Income?

1. What is the definition of National Income?

• A. Total income of a country's citizens
• B. Total value of goods and services produced in a country
• C. Total consumption by households
• D. Total investment in a country

2. National Income is a measure of:

• A. Total economic activity
• B. Total income of the government
• C. The total wealth of a country
• D. The total income of individuals only

3. Which of the following is included in National Income?

• A. Only the income of government employees
• B. Income from non-market activities
• C. Income from production of goods and services
• D. Only income from exports

4. Which sector does National Income measure?

• A. Only the government sector
• B. Only the private sector
• C. The entire economy, including government, private sector, and foreign trade
• D. Only the trade sector

5. The total value of goods and services produced in a country during a given period is:

• A. Gross Domestic Product (GDP)
• B. Gross National Product (GNP)
• C. Net National Product (NNP)
• D. None of the above

1.2 Importance of National Income

1. Why is National Income important for a country?

• A. To measure the income of rich people
• B. To compare the standard of living between countries
• C. To understand the total consumption in the economy
• D. None of the above

2. National Income helps in:

• A. Understanding economic growth
• B. Comparing the wealth of individuals
• C. Measuring the inflation rate
• D. Calculating total investments only

3. The standard of living of people can be compared using:

• A. National Income per capita
• B. Gross Domestic Product (GDP)
• C. Unemployment rate
• D. All of the above

4. National Income is used by governments to:

• A. Allocate resources effectively
• B. Determine tax rates
• C. Analyze social welfare programs
• D. All of the above

5. National Income is useful for:

• A. Calculating inflation
• B. Formulating economic policies
• C. Measuring unemployment rates
• D. All of the above

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