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

Explanation:

• 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 includes the value of all final goods and services produced within a country's borders during a specified period of time. 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.