Arrange the following steps in calculation of National Income by "Inc…

The correct answer is Option (3) → C, B, D, A

The income method adds up the incomes paid to the factors of production: wages, rent, interest and profit. The steps go from the producing units to the sectors, then to the domestic total, and last to the national total.

• C. Identify and classify the income-generating units — First, find the producing units in the country and group them into sectors.

• B. Estimate the factor income paid by each sector — Next, for each sector, estimate the factor incomes it pays.

• D. Calculate domestic factor income — Then add the incomes of all sectors. This gives domestic factor income, or Net Domestic Product at factor cost (NDP_FC), the income earned inside the country.

• A. Add net factor income from abroad to arrive at National Income — Last, add net factor income from abroad (NFIA). It is the income our residents earn abroad minus the income foreigners earn in our country. This turns the domestic total into the national total.

Note: A same/similar question was asked in CUET (UG) in the papers below.

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