Choose whether the statement is true/false:

National income is the total income of every individual residing in the country.

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True

False

answer is B.

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Detailed Solution

The above statement is false.
The monetary value of all finished products and services generated in an economy over a fiscal year is known as national income. At the level of an economy, the entire revenue from all means of production—labour, capital, land, and entrepreneurship—is equal to the value of fined products and services. Total revenue is the same as total spending on goods and services. Consequently, in a market, the gross national product (GNP), net national product (NNP), gross domestic product (GDP), net domestic product (NDP), and other terms are alternative ways to assess national income. Despite some conceptual differences, they are frequently used interchangeably. For example, the consumption of fixed capital causes the GNP and NNP to differ. However, the difference between the GDP and NDP is the same. Hence the correct statement would be, National income is not the total income of every individual residing in the country.

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