Explain five factors that may influence the level of national income of a country. (10 marks)

Factors that may influence the level of national income of a country.

1. Human resources / labour / working population / manpower
2. A country with skilled /(highly) trained / large manpower can produce quality/quantity goods/services / can generate high income.
3. A country with unskilled / or untrained / small manpower can produce low quality / quantity goods / services can generate low income.
4.  Natural resources / land ./ gifts of nature / accept gift of nature
5.  a country endowed with natural resources can produce more good / services / can generate income.
6.  A Country not well endowed with natural resources may produce less goods /services / can generate less income.
7.  (Level of ) technology
8.  High level of technology may produce low quality / quantity of goods / services / generate high income.
9.  Low level of technology may produce low quality / quantity goods / services / generate low income.
10.  Capital (equipment) / man – made resources / accept if manmade resources e.g. infrastructure buildings.
11.  Availability of capital / manmade resources (goods) makes production easy / preserves production (resulting in increased natural income) / may generate high income.
12.  Lack of capital / or makes production different / reduces production / may generate low income.
13.  Foreign investment
14. Investments from abroad may increase natural income to the country / increase production of goods / services / investments abroad may increase national income.
15.  Reduction of foreign investment may reduce production of goods / services / income.
16. Good governance / political stability
17.  Production of goods / services / investments / income increase as a result of good governance / political stability creates confidence in investors.
18.  Poor governance / political instability reduces savings / investment / damages / investment / reduce incomes / production of goods / services.
19.  Culture / entrepreneurship
20.  Culture that encourages hared / work / entrepreneurship reduces production of goods / services / may generate low income.
21.  Culture that encourages hard / work / entrepreneurship reduces production  of goods / services / may generate low income.

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