Find out the correct statement from the following :

Final goods are included in national income

The correct answer is option (3) : Final goods are include in national income

• Externalities are included in national income:Incorrect.  Externalities, such as environmental impacts or social costs, are not typically included in the calculation of national income because they are considered external to the market transaction and not directly monetized.

• Donations are a part of national income: Incorrect. Donations are transfers of wealth and are not considered part of national income because they do not result from economic production or exchange. They are transfers.

• Final goods are included in national income: Correct. This statement is correct. National income accounting includes the value of final goods and services while excluding intermediate goods to avoid double counting. Final goods are those goods that are ready for use by consumers or for investment without further processing.

• Income method avoids double counting of income: Incorrect. The value added method (Not Income Method) avoids double counting of income.