Suppose a firm produces and sells goods worth ₹100 to the final consumer
However it had taken a loan from Bank for consumption purposes the interest on which was ₹30
This is a part of intermediate cost
In this case as per value added method National income is ₹70 however as per Expenditure method it is ₹100 as that is final expenditure by consumer households
So why is this difference in National income by using 2 different methods???