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Question
How should the following be treated in estimating National Income of a Country? Give valid reasons.
Expenditure on upgradation of fixed asset by a firm.
Answer in Brief
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Solution
Expenditure on upgradation of fixed asset by a firm: Included in national income.
Reason: It is capital formation expense. As a result, it is a sort of investment expenditure, and it is included in the estimation of National Income on both consumption and investment.
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2022-2023 (March) Delhi Set 2
