Is transport expenses by a firm included/excluded in national income?
Is transport expenses by a firm included/excluded in national income?
Anurag Pathak Changed status to publish December 8, 2023
No,
the transport expenses by a firm will not be included in the national income as it is a part of intermediate consumption expenditure.
Explanation:-
National Income only counts the value of final goods.
The value of final product of the firm will be counted in the national income.
The transportation expenses are already included in the value of final product/services of the firm.
If the transport expenses by a firm is added to the national income, it will lead to double counting.
Thus, the transport expenses by a firm is considered as intermediate consumption and will not be included in the national income.
Anurag Pathak Changed status to publish December 8, 2023
