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Discussion

Real national income denotes

  • A.Net factor income
  • B.National income at current prices
  • C.National income at constant prices
  • D.Per capita income

Answer: B

Real national income is national income at constant prices.

Valuing output at the prices of a fixed base year strips out the effect of inflation, so that a rise in the figure means more goods and services and not merely dearer ones. National income at current prices is the nominal measure.

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