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JAMB Economics 2007 Question 26

Question 26

National Income

One way of solving the problem of double counting is by computing national income using the

  1. A.income method
  2. B.expenditure method
  3. C.value-added method
  4. D.output method
Show the answer and explanation

Answer: C (value-added method)

Explanation

The value-added method counts only the extra value created at each stage of production, so intermediate goods are not counted twice.