SOME IMPORTANT TERMS RELATED TO NATIONAL INCOME ACCOUNTING
BOUT ME .Graduation in Computer Engineering from Panjab University, Chandigarh. . Post-graduation in Business Administration from Panjab University, Chandigarh . Cleared UPSC Preliminary Examination thrice .Appeared for UPSC interview. . Working at Career Launcher. .Follow me at http://unacademy.in/user/goyalsamridhi02
IMPORTANT DEFINITIONS What is an Economic territory? vWho is a citizen? Who is a resident? Difference between resident and citizen? National Product Domestic Product
What is an Economic territory? A geographical territory Administered by a government. within which persons, goods, and capital " circulate freely. Above implies that those parts of the political frontiers of a country where the government of India, does not enjoy the above "freedom" are not to be included in economic territory of that country.
WHAT IS ECONOMIC TERRITORY? . Example: Embassy of U.S.A in India. Government of India does not enjoy the above freedom in the foreign embassies located within India. So, these are not treated as a part of economic territory of India. . They are treated as part of the economic territories of their respective countries. USA embassy in India is a part of economic territory of the USA. Similarly, the Indian embassy in Washington is a part of economic territory of India.
WHAT IS AN ECONOMIC TERRITORY? Scope covers: .Political frontiers including territorial waters and air space. . Embassies,consulates, military bases located abroad but excluding those located within t political frontiers Ships, aircrafts operated by the residents between two or more countries Fishing vessels, oil and natural gas rigs operated by the residents in the international waters or other areas over which the country enjoys the exclusive rights or jurisdiction
What is the difference between citizen and resident? Citizenship is a legal concept based on the place of birth of the person or some legal provisions allowing a person to become a citizen Residentship is an economic concept based on the economic activities performed by a person.
t is the difference between citizen and resident? A resident whether a person or an institution is one whose centre of economic interest lies in the economic territory of the country in which he lives. That is NRI are citizens of India but their economic interest lies in other countries( an engineer working in US thus its economic interest is in US)