12th Class Economics Solved Paper - Economics 2012 Delhi Set-III

  • question_answer
    Comparing reason explain how should the following be treated in estimating National Income:
    (i) Interest paid by banks on deposits by individuals.
    (ii) National debt interest.

    Answer:

    (i) Interest is a factor payment by a producer, so, interest paid by banks on deposits by individuals is included in the estimation of National Income.
    (ii) National debt interest is a transfer payment and this loan is taken for consumption purposes. So, it is not included in the estimation of National Income.


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