National Income and Wages

1. WELCOME
TO OUR PRESENTATION

2. We are the….
GLADIATORS
12th Batch(EMBA); Sec-“B”
Department of Marketing
Jagannath University
WE HAVE…
 Kamrul Hasan (ID-M 17120204742)
 Md. Ahaduzzaman (ID-M 17120204752)
 Monir Uddin (ID-M 17120204762)
 Mahmudul Hasan (ID-M 17120204767)
 Masud Kaysar Asif (ID-M 17120204774)
 Mohammad Kayes khan (ID-M 17120204775)

3. HERE WE DISCUSS ABOUT..
“National Income” and “Wages”

4. INTRODUCTION
National Income is defined as the sum total of all the goods and
services produced in a country, in a particular period of time.
Normally this period consists of one year duration, as a year is neither
too short nor long a period. National product is usually used
synonymous with National income.
A wage is monetary compensation (or remuneration, personnel
expenses, labor) paid by an employer to an employee in exchange for
work done. Payment may be calculated as a fixed amount for each
task completed (a task wage or piece rate), or at an hourly or daily
rate (wage labor), or based on an easily measured quantity of work
done.

5. NATIONAL INCOME
 National Income is the sum-total of factor- incomes earned by
normal residents of a country during the period of one year.
 National Income is also defined as the sum-total of market-value of
final goods and services, produced by normal residents of a country
in one year.
 National income is defined as the total value of all goods and
services produced within a country in a particular period.

6. OBJECTIVES
 To indicate significance of the world’s major trading nations
 Identify newly emerging economic nations
 Identify the key determinants of the success of the emerging
nations.
 Determine the reasons why some nations are showing downfall.
 To explain the circular flow of economic activity and income.
 Introduce the concepts of aggregates, stock and flow and final
goods.
 To explain various concepts of national income, like GDP, GNP
and NNP.

7. IMPORTANCE
 National income figures are an important tool of macroeconomic
analysis and policy.
 National income statistics are the most important tools for long-
term and short-term economic planning.
 National income statistics enable us to have clear idea about the
structure of the economy.
 National income studies show how national expenditure is divided
between consumption expenditure and investment expenditure.
 National income figures enable us to know the relative roles of
public and private sectors in the economy.

8. CONCEPTS
Gross Domestic Product (GDP)
GDP measures the aggregate money value of output produced by the
economy over a year. In other words, GDP is obtained by valuing all
final goods and services produced domestically in a year at market
prices.
GDP=C+I+G+(X-M)
Where, C=Consumption
I=Investment
G=Government expenditure
(X-M)=Export minus impor

9. CONTINUE…
Gross National Product (GNP)
This is the basic social accounting measure of the total output or aggregate
supply of goods and services. Gross National Product is defined as the total
market value of all final goods and services produced in a year.
GNP=C+I+G+(X-M)+NFIA
GNP includes the following:
C=Consumer goods and services
I=Gross private domestic investment in capital goods.
G=Government expenditure.
(X-M)=Net exports (exports-imports).
NFIA=Net factor income from abroad.

10. CONTINUE…
Net National Product (NNP)
This concept of national income is that of net national product. In the
production of gross national product of a year, we consume or use up
some capital, i.e., equipment, machinery, etc.
NNP=C+I+G+(X-M)+NFIA-Depreciation

11. CONTINUE…
National Domestic Product (NDP)
The full form of NDP is National Domestic Product. It is the gross
domestic product (GDP) minus depreciation on a country's capital
goods.
NDP = Consumption + Government Expenditures + Investment
+Exports - Imports – Depreciation

12. CONTINUE…
Personal Income (PI)
Personal Income is the sum of all incomes actually received by all
individuals or households during a given year.
Personal Income =National Income —Social Security Contributions
—Corporate Income Taxes—Undistributed Corporate Profits +
Transfer Payments.

13. CONTINUE…
Disposal Income (DI)
After a good part of personal income is paid to government in the
form of personal taxes like income tax and personal property taxes,
what remains of personal income is called disposable income.
Disposable Income = Personal Income—Personal Taxes.
Disposable Income can either be consumed or saved. Therefore
Disposable Income = Consumption + Saving.

14. WAGE
Payment for labor or services to a worker, especially remuneration on
an hourly, daily, or weekly basis or by the piece. In economic theory,
wages reckoned in money are called nominal wages, as distinguished
from real wages, i.e., the amount of goods and services that the
money will buy. Real wages depend on the price level, as well as on
the nominal or money wages.
A wage is price, it is the price paid by the employer to the worker on
account of labor performed.
Wage rate is the price paid for the use of labor.

15. OBJECTIVES
 To establish a fair and equal pay for similar work.
 To attract competent and qualified personnel.
 To retain the present employees To improve motivational levels of
employees
 To project a good image of the company
 To establish sequence of lines of promotion
 To minimize the changes of favoritism while assigning the wage
rates.

16. IMPORTANCE
 One of the most important aspects of a job for most workers is the
wage it pays.
 Wages allow workers to make a living from their labor.
 Also provide incentives to be productive and loyal to an employer.
 In a broader sense, the wages workers earn fuel of the economy.
 Importance of wages for all-day life and for the global economy.
 Wage growth rather indexed to the overall growth and productivity,
then to the volume of employment, finally on prices.

17. CONCEPTS
The Concept of the Living Wage
Justice Higgins of the Australian Commonwealth Court of the
Conciliation in t he Harvester Case defined the living wage as one
appropriate for "The normal needs of the average employee, regarded
as a human being living in a civilized co mm unity."

18. CONTINUE…
The Concept of Fair Wage
The Committee Fair Wage s said that the fair wages lies between a
mini mum wage and a living wage. The Committee envisaged that
while the lower limit of the fair was must obviously be t he minim um
wage, the upper limit is equally set b y what may broadly be called
the capacity of the industry to pay .

19. CONTINUE…
The Concept of Minimum Wage
The Committee on Fair Wages stated that the minimum wage must
provide not merely for the subsistence of life,' but for the preservation
of the worker.

20. PAYMENT OF WAGES ACT,
1936
 Applies to persons drawing less than Rs.6,500/- p.m.
 Wage period – Not exceeding one month
 Time of payment – 7 days
 Currency or coins
 Permissible Deductions
 Deductions for-
Fine
Absence from duty
Damage or loss
Professional Tax
Recovery of Loans
Trade Union
Others – written authorization.

21. COMPONENTS OF WAGE
Incentives
Also called ―payments by results‖, incentives are paid in addition to
wages.
Incentives depend upon productivity, sales, profit or cost reduction
efforts. There are:
 Individual incentive schemes and
 Group incentive programs.
Individual incentives are applicable to specific employee performance.
Where a, given task demands group effort for completion, incentives are
paid to the group as a whole. The amount is later divided among group
members on an equitable basis.

22. CONTINUE…
Fringe Benefits
These include such motley crowd of employee benefits as provident
fund, gratuity, medical care, hospitalization, accident relief, health
and group insurance, canteen, uniform, recreation and the like.

23. CONTINUE…
Perquisites
These are allowed to executive and include company car, club
membership, paid holidays, furnished house, stock option scheme and
the like. Perquisites are offered to retain competent executives.

24. CONTINUE…
Non-monetary Benefits
These include challenging job, responsibilities, recognition of merit,
growth prospects, competent supervision, comfortable working
conditions, job sharing and flexi time.

25. CONCLUSION
The payment of wages Act was passed to regulate the payment of
wages to certain class of persons employed in industry. It applicable
to factory, railway, industrial and other establishment etc. Every
employer is responsible for payment of wages and payment must be
paid to employed person not exceed than one month .Wages paid to
the workers in terms of current coin and currency notes or cheque or
credited to employees bank account. Section 7 to 13 of the payment
of wages Act is related to the deductions which may be made from
wages. All deduction must be done with the consent of the employed
person.