National Income

nialloriordan
Mind Map by nialloriordan, updated more than 1 year ago
nialloriordan
Created by nialloriordan over 6 years ago
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Economics Mind Map on National Income, created by nialloriordan on 12/04/2013.
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Resource summary

National Income

Annotations:

  • measures the income earned by the permanent residents of a country in a year
1 GDP

Annotations:

  • the value of all goods and services produced in the economy in a year
2 Circular flow of income

Annotations:

  • the flow of income around the economy

Attachments:

2.1 Injections

Annotations:

  • causes a rise  Investment Exports government spending
2.2 Leakages

Annotations:

  • causes a reduction Savings Imports  Taxtion
3 Measurements
3.1 Income Method

Annotations:

  • Income from each firm 
3.1.1 Incomes-in-kind

Annotations:

  • Non-monetary benefits received by an individual e.g company car
3.1.2 Transfer Payments

Annotations:

  • Payments for which no factor of production have been supplied e.g child benefit
3.2 Expenditure Method

Annotations:

  • Total value of the purchase of goods and services by individuals, firms and government
3.2.1 Y=C+I+G+(x-m)
3.3 Output Method

Annotations:

  • Total value of everything produced by all the services
4 Uses
4.1 measure economic growth
4.2 International comparisons
4.3 standard of living
4.4 Assist the government in formulating economic policy
5 Limitations
5.1 inflation
5.2 populations size
5.3 distribution of income
5.4 nature of the goods produced
5.5 Unrecorded economic activity
6 Multiplier

Annotations:

  • refers to the number of times an injection leads to an increas in national income

Attachments:

7 Net factor Income from the rest of the world

Annotations:

  • Refers to the difference between the income earned by foreign firms and individuals in Ireland and the income earned by the irish firms and individuals abroad
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