Write any four practical difficulties in national income estimation?

Question: Write any four practical difficulties in national income estimation?

1. Measurement of output from non-monetized sectors: The output from certain activities may not be monetized and hence it is difficult to incorporate them in the national income estimate.

2. Disguised Unemployment: Disguised unemployment in form of under-employment or over-employment acts as a dampener to true economic activities. Thus, it affects the accuracy of national income.

3. Valuation of Depreciated Assets: Valuing assets that are subject to depreciation in their value presents a major challenge in measuring national income.

4. Cost of Production: Estimating the cost of production items affects the accuracy of the estimated national income. It includes the cost of raw materials and other costs incurred in production.