The expenditure method of estimating national income includes ___________.

expenditure made by individuals and households, government and business firms

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expenditure on services

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total expenditure on infrastructure

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none of the above

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Solution

The correct option is A expenditure made by individuals and households, government and business firms
Expenditure method of measuring national income takes into account the expenditures made by various economic agents in the economy in a given year. The economic agents refers to individuals, households, business firms and government.

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Giving reasons, explain the treatment of the following while estimating national income:

(i) Expenditure on maintenance of an office building

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