Importance of national income statistics essay

Like many of the sciences, communication uses statistical methods to communicate data received. National income figures enable us to know the relative roles of public and private sectors in the economy. The inclusion of intermediate goods would involve double counting and will, therefore, give an exaggerated estimate of gross national product.

Importance of National Income Studies : 11 Reasons

Modern governments try to prepare their budgets within the framework of national income data and try to formulate anti-cyclical policies according to the facts revealed by the national income estimates. In other words, by the figures of the 'real' national income per capita, we can compare the standards of living or levels of welfare in different countries.

This is so because the flow of money is a measure of national income and will therefore change with change in national income. It enables us to provide for reasonable depreciation to maintain the capital stock of a community. The preparation of social accounts is by no means as easy task, as there is good deal of dependence on statistical data.

But the economy does not merely consist of households and firms. Inflationary and Deflationary Gaps: Even the taxation and borrowing policies are so framed as to avoid fluctuations in national income.

An example will clarify this point. What is the significance of national income accounting or social accounting. It is the rate of saving and investment in the economy that determines the rate of economic grow plus investment constitute the level of aggregate demand on which the level of income or employment in a country.

Meteorology uses statistics in stochastic-dynamic prediction, weather forecasting, probability forecasting, and a number of other fields. Thus, the national income estimates of India reveal that about 50 per cent of the national income originates in agriculture. Search Importance of National Income Statistics There are several important uses of national income statistics and, therefore, there is great need for their regular preparation.

National income figures are an important tool of macroeconomic analysis and policy. From such figures, we can easily know how much can be spread for war by the civilian population.

The Role of Statistics in Economics Much of economics depends on statistics.

Importance of National Income Statistics

It is through such estimates that we know the aggregate yield of the economy and lay down future economic policy for development. Jun 20,  · Importance of National Income Analysis Written By Fathimath Sama on Saturday, 22 June | Today, national income statistics are collected by all the countries of the world for a number of years.

Reasons for Growing Importance of National Income Studies

National income statistics enable us to have a correct idea about the structure of the economy. It enables us to know the relative importance of the various sectors of the economy and their contribution towards national income. National income accounting is important because it is a government accounting system used to measure the level of economic activity.

For example, it is used to measure the total amount of revenues earned by various companies in the country, the total wages paid and total tax revenues.

National Income Statistics and Standard of Living The national income statistics show that the USA has the highest standard of living; this can be proved by looking at the gross national income of The United States, which is $12, million, and the gross national income per capita which is $43, May 16,  · The same can be said for figuring out the inflation rate, the per capita income, and even the national income account.

Importance of National Income Statistics

A good example of statistics and economics in the real world would be the Census Bureau and the information they collect and use to decide many other political douglasishere.com: Natasha Quinonez. May 16,  · The same can be said for figuring out the inflation rate, the per capita income, and even the national income account.

A good example of statistics and economics in the real world would be the Census Bureau and the information they collect and use to decide many other political douglasishere.com: Natasha Quinonez.

Importance of national income statistics essay
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Importance of National Income Statistics