# how to calculate national income through expenditure method?

national income = private final expenditure + government final expenditure + gross domestic capital formation + net exports.

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thank you sanjana

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first of all we calculate gdp at mp=private final consumption expenditure+govt final consumption expenditure+investment expenditure+net exports

then deduct depreciation add net factor income from abroad and deduct net indirect tax then we get national income

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First we cal. GDP at MP= private final consumption expenditure + govt. final consumption exp. + bussiness fixed investment +govt. fixed investment + investment on residental construction + inventory stock(closing stock - opening stock) + net export(x-m).

secondly, NDP at MP= GDP at MP - N.I.T

AT LAST, we cal. NNP at FC(NATIONAL INCOME)=NDP at MP + NFYA.

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1.  Private final consumption expenditure
2.  General govt. final consumption expenditure
Final consumption expenditure (1+2)
3.  Gross domestic capital formation (GDCF)
(GDCF = Gross Domestic fixed capital formation + change in stock = valuables)
4.  Net export (N.E = Export - Import)

Gross domestic product at market price (GDPmp)(1+2+3+4)
5.  Net factor income from abroad
Gross national product at market price (GNPMP) (1+2+3+4+5)
Subtract (-)
6.   Net indirect taxes
Gross national product at factor cost (GNPFC) ( 1+2+3+4+5-6)
Subtract (-)
7.   Depreciation
Net national product at factor cost (NNPFC) (1+2+3+4+5-6-7)
Or national income
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Expenditure method steps involved:

A. Identifying economic units andincurring final expenditure

Economic units are:

household sector

govt sector

production sector

and, rest of the world

B. classification of final expenditure

final expenditure is classified as:

(a)final consumption expenditure: (i)private final consumption expenditure (ii)govt final consumption expenditure

(b)gross domestic capital formation:(i)gross domestic fixed capital formation (ii)changes in stock

(c)net exports=value of exports-value imports

C. GDP AT MP= FINAL CONSUMPTION EXPENDITURE+GROSS DOMESTIC CAPITAL FORMATION+NET EXPORTS

NATIONAL INCOME(NNP AT FC)=GDP AT FC-CONSUMPTION OF FIXED CAPITAL+NFIA-NET INDIRECT TAX

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Hey

In the case of the divers..deep underneath the pressure is very high that the gases are easily soluble in the blood in high concentrations..i.e.by the henry's law that the solubility is propotional to the partial pressure at low temperature.

when the divers reach the surface..the pressure decreases.. leading to the release of the dissolved gases such as Nitrogen , which leads to the formation of bubbles in blood..BENDS(blockage of the blood capillaries due to the bubbles)

To avoid these.. divers use helium in the tanks along with the air..:)

hope this helps u..:)

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National income = C + G + I + X + F ? D

This concludes the article on National Income Formula, which plays an important role in determining the income generated in a country.
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Using the expenditure approach, national income can be represented as follows: National Income = C (household consumption) + G (government expenditure) + I (investment expense) + NX (net exports).
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What???
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National Income = C (household consumption) + G (government expenditure) + I (investment expense) + NX (net exports). This is how National Income is calculated by the expenditure method. Also, keep in mind Expenditure is GDP at MP. You have to convert that GDP at MP into NNP at FC (National Income).
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