Question

Answer briefly each of the following questions.
Explain with the help of an example, the problem of double counting while calculating national income.

Answer 1

While estimating the National income, the value of only final goods and services is included. However the problem of double counting arises when value of intermediate goods is also included along with the value of final goods. So, double counting means a counting of an output more than once in the process of various of stages of production.