Which of the following options represents the total income earned by individuals from all the sources before deduction of personal income taxes?

Correct option is C

The Correct answer is (c) Gross income.

Explanation:

• Gross income represents the total income earned by individuals from all sources before the deduction of any taxes or personal expenses. It includes wages, salaries, bonuses, rental income, dividends, interest, and any other form of income.
• Personal income refers to the total income received by individuals, including wages and salaries, interest, dividends, and other earnings before subtracting personal income taxes. It is a broader term than just gross income but excludes certain non-taxable incomes.
• Disposable income refers to the income left after the deduction of personal income taxes. This is the amount available for spending and saving by households.
• National income is the total income earned by a country's residents and businesses, including wages, profits, rents, and taxes, minus subsidies, within a specific period.

Information Booster:

·         Gross income includes all sources of income without deductions.

·         It represents earnings before taxes and personal expenses.

·         Personal income includes gross income and other earnings but before tax deductions.

·         Disposable income is the income left after paying personal income taxes.

·         National income is the total income of a country’s residents and businesses, after considering production and subsidies.

·         Gross income is a common financial term used for both individuals and businesses.