In computing national income, transfers are excluded because
Answer Details
Transfers are excluded from the computation of national income because they are not payments for productive activities. Transfers are simply the transfer of money or goods from one person or institution to another, without any productive activity involved. They are not part of the income generated by the production of goods and services in the economy, so they are not included in the calculation of national income. Examples of transfers include social security payments, welfare payments, and gifts.