Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: National Income Accounting

Question:

Which item is included in computing national income under expenditure method?

Options:

second hand goods

intermediate goods

transfer payments

broker's commission

Correct Answer:

broker's commission

Explanation:

The correct answer is option 4: broker's commission

 

  • Second-hand goods: Not included, as they do not represent current production; they are just resold items.
  • Intermediate goods: Not included, to avoid double counting. They are goods used in the production of final goods and services.
  • Transfer payments: Not included, as they are not payments for goods or services but rather transfers from the government or other entities (e.g., pensions, unemployment benefits).
  • Broker's commission: Included, as it represents a service provided in the current period and contributes to the overall expenditure on final goods and services.