Correct option is B
Tha Correct Answer is: (b) Donation
Explanation:
Factor income refers to the income earned by factors of production (land, labor, capital, and entrepreneurship) in exchange for providing productive services. This includes:
However, donation is not a factor income because it is a transfer payment. It does not result from any productive economic activity and is received without providing any goods or services in return.
Transfer payments (such as donations, gifts, scholarships, and pensions) are considered non-factor incomes.
Information Booster:
- Factor income includes wages, rent, interest, and profit, which are payments for productive services.
- Non-factor income consists of transfer payments like donations, social security benefits, and subsidies, which do not arise from economic production.
- Interest is the payment for capital investment and loans.
- National income is calculated using factor incomes.
Additional Knowledge:
- Profit : A type of factor income earned by entrepreneurs after deducting expenses.
- Wages : Payment made to workers or employees for their labor, classified as factor income.
- Rent : Income earned by landowners for leasing their property or land, making it a factor income.
English
100 Questions
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