49830519 Ppt Economics National Income 1

7/30/2019 49830519 Ppt Economics National Income 1

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Presentation onTopic National income analysis

Presented By

J&T

JYA


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Contents

Introduction To Topic

Introduction To Concern

Objectives Of The Study

References

Data Accumulated

Conclusions

Recommendations


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Introduction To Topic

National income refers to the market valueof the goods & services produced by aneconomy during the period of one year,

without duplication. National income is the money value of all

final goods & services produced in acountry during a period in one year.

Low income>low savings>lowinvestment>low productivity>low income


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Introduction To Concern

National income is a part of macro economics

Macroeconomics is the study of economy as awhole. The study of economy as a whole iscarried out by analyzing the behaviour of &interaction between macroeconomics variablesincluding national output (GDP &GNP),aggregate employment,the general price

level,aggregate consumption,savings &investment,price level & economic transactionswith the rest of the world.


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Objectives Of The Study

To become aware about the methods ofcalculating national income.

To become aware about national income

concept as a whole. To know the national income of our

country.

To know the growth rate of our country.

To become aware about the history ofnational income.


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Data Accumulated

History of National income concept

In 1876 , Dadabhai Naroji was the firstperson to prepare estimates of nationalincome & per capital income for the year

1867-68.Calculation of per capital income

Per capital income = National income of year

2009 divided by Population of 2009.


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Estimates of national income & per capital

incomebefore independenceEstimated by Yr.Of Estimate Natitonal Income(Rs Crore)

Per Capital

Income(Rs)

Dadabhai naroji 1867-68 340 20

Wadia & joshi 1913-14 1067 44

Shah & khambata 1921-22 2364 74

V.K.R.V. Rao 1931-32 1689 62

Ministry of commerce 1945-46 6234 198

(govt.of india)


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Comparison of per capital income with othercountries

Country Per Capital Income(us dollars)year 2006Usa 44970

Uk 40180

Japan 38410

China 2010

Srilanka 1300India 820

Pakistan 770

(Source:world development report,2007)


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Methods of Measuring National Income

Product or Value Added Method or NetOutput Method

Income Method

Expenditure Method & Commodity FlowMethod


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Importance Of Measure National Income

o It helps us to estimate the level ofeconomic development of nation.

o It is used in computing per capital income.

o It is used for analysing various phases ofbusiness cycles.

o It is used for framing various policies by the

government.o It helps in comparing economic growth of

our country with other nations.


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Difficulties In Measuring National Income In India

Non monetised sector

Lack of distinct differentiation of economicactivities

Black money

Inter regional differences

Conceptual problems

Mass illiteracy

Non availability of data about certain incomes

Difficulties of sampling technique

Lack of skilled personnel to collect data &

prepare estimates


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What National Income Does Not Measure?

Income from illegal activities likeSmuggling,Gambling etc

Income from non economic activities like

domestic work by Housewives,work donewithout remuneration.

Black Moneyi.e.income which is not reported

to income tax authorities, and on whichincome tax is not paid.


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Measures Of National Income GNP (Gross national product)

GNP is defined value of all final goods & services produced in

one year but plus income earned abroad by the nationals &minus income earned locally by foreigners.

GDP (Gross domestic product)

In case of GDP,minus income earned abroad by the nationals

& plus income earned locally by foreigners from the total valueof domestically produced goods & services.

NNP (Net National Product)

The NNP gives the measure of net output available for

consumption by the society (including consumers,producers &the government).NNP is the real measure of the nationalincome.NNP=NNI(Net National Income)

o NDP (Net Domestic Product)

NDP = NNP less net income from abroad


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ercen age ra e o grow o na onaincome at constant prices

Plans percentage growth of national income

First plan(1951-56) 3.6Second plan 4.1

Third plan 2.5

Fourth plan 3.3

Fifth plan 5.0

Sixth plan 5.4

Seventh plan 5.8

Eight plan 6.7

Ninth plan 5.5

Tenth plan 7.8

Eleventh plan (target)(2007-2012) 9.0


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Growth Rate Of GDP Of Different Nations(Annual Average In Percentage)

Country 1969-70 2005-06Usa 4.3 2.4

Japan 10.9 2.4

Germany 4.4 2.9China 5.2 10.1

Srilanka 4.6 6.6

Pakistan 6.7 4.1India 3.4 7.7

World 5.0 2.8

(source:world development report,2007)


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National Income-Industrial Origin

Central statistical organisation has divided theeconomy into three basic sectors:

Primary sector

(Agriculture,forestry,fishing,mining & Quarrying)

Secondary sector

(Manufacturing,power generation,gas & watersupply)

Tertiary sector/service sector

(1. Transport,Communication & Trade2. Banking,Insurance & Computer Software3.Public Administration,Defence & Other

Services 4. External Trade)

f l f d


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Causes Of Low National Income Of India

Economic causes

Low rate of saving & investment

Backward technology

Rapid increase in population

More dependence on agriculture

Inadequate industrial development

Inadequate progress of transport & power

Unbalanced growth of different regionsSocial causes

(Illiteracy,social institutions,fatalism)

Political causes


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Conclusions

National income of our country is less,comparisons with different nations.

our country is under developed economy,on growing stage.

Various causes is a hurdle in the successof our country.

National income represents the growth &development of economy.


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Recommendations

Increase in rate of saving & investment

Modern technology Development of agriculture

Development of industries

Development of transport & power More social welfare services

Growth of foreign trade

Proper Use of natural resources Education

Development of banking & insurance

Political stability


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References

Managerials economics by D N Dwivedi

Indian economy by T.R. Jain

Managerial economics (kalyani publisher) Managerial economics by T.R.Jain

49830519 Ppt Economics National Income 1

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