The income method calculates total national income by adding up all incomes earned from supplying factors of production like employment, self-employment, profits, and rent during a given time period, ignoring transfer payments. The expenditure method adds up all money spent on consumption, investment, government expenditure, and net exports for the year's output, excluding indirect taxes and spending on used goods. The output method breaks the economy into sectors, calculates the value added of each by taking inputs from outputs, and sums the sectors' value added or final output to determine national income.

1. ncome Method
The income method adds together the total value of all incomes that have been earned in the
relevant time period. These may include income from employment, income from self
employment, profits, surpluses of public (government) corporations and rent. Note that only
incomes earned from supplying a factor service are counted. Transfer payments are ignored.
Expenditure Method
The government adds up all the money spent in buying this year's output. This will be the total
of Consumption, investment, government expenditure and net exports (exports - imports). This
ignores:
-Indirect taxes and subsidies included in the selling price.
-Spending on second-hand goods.
Output Method
The economy is broken up into twelve different sectors (eg manufacturing). The money spent on
making the goods (inputs) is taken away from the money received from the sale of the goods
(outputs) to give each sector's value added. Taking final output or adding up each sector's value
added gives national income.