Question

differnce between monetary national income and real national income

Answer 1

Monetary national income or nominal national income is the total value of flow of goods and services in an economy during an accounting year at prevailing market prices. It is not a true indicator of the economic performance of an economy as the increase in nominal income may be a result of inflation within an economy. On the other hand, a real national income is the ratio of nominal income to prices. That is real national income = $\frac{nominalnationalincome}{prices}$ .
It is a true indicator of the economic growth of an economy as it eliminates the effect of changes in price over time.