The national income is the total net value of all goods and services produced within a nation over a specified period of time, representing the sum of wages, profits, rents, interest, and pension payments to residents of the nation.
Standard of Living: The per capita GNP allows the economists to compare the standard of living of different nations. In general, a nation has a higher standard of living if its per capita GNP is greater than that of another nation. This also indicates whether the government of an economy has or has not been able to achieve its macroeconomic objective of economic growth. National income accounting measures the welfare of the citizens of a country. By the help of national income accounting economists can compare the standard of living of different countries or of the people of same country of different times. The higher per capita income reflects the higher level of welfare.
