Pi salaries interest income rent income dividend income transfer payment the calculation can be done as follows. Goods and services where as.
Here operating surplus rent interest profit.
Income formula economics. Pi 1 00 000 8 000 7 500 3 000 2 000. However when an analysis is performed at the macroeconomic level then the economic formula is derived by the means of gross domestic product. The popular economic formulas are based on the fact of how the economy is being analyzed.
Y in this formula y represent amount to be spent x and y are commodities i e. In consumer theory income is called budget constraint it formula is y px. National income nnpfc net domestic product at factor cost ndpfc net factor income from abroad.
Steps of income method formula. Identification and classification of production units. Here ndpfc compensation of employees operating surplus mixed income.
If the analysis is done on the micro economic level then the economic formula is determined as the difference of total revenues generated by business and the cost incurred to generate the revenue.