Topic: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.
4. What does the term “national income” signify, and why is it significant? Discuss the different approaches to calculating national income. (250 words)
Difficulty level: Easy
Reference: Insights on India
Why the question:
The question is part of the static syllabus of General studies paper – 3 and mentioned as part of Mission-2024 Secure timetable.
Key Demand of the question:
To write about national income, its importance and methods to compute it.
Directive word:
Discuss – This is an all-encompassing directive – you must debate on paper by going through the details of the issues concerned by examining each one of them. You must give reasons for both for and against arguments.
Structure of the answer:
Introduction:
Begin by defining national income.
Body:
First, write about the importance of national income as a macroeconomic parameter and it indicates.
Next, write about the various methods of computation of national income – Product Method, Income Method and Expenditure Method.
Conclusion:
Conclude by summarising.
