Question : Which of the following is not included in the calculation of national income?
Option 1: Rental income
Option 2: Interest income
Option 3: Capital gains
Option 4: Transfer payments
Correct Answer: Transfer payments
Solution : The correct answer is d) Transfer payments.
Transfer payments, such as government assistance programs, social security benefits, and welfare payments, are not included in the calculation of national income. These payments are considered transfers of income from one group to another and do not directly contribute to the production of goods and services within the economy.
On the other hand, rental income, interest income, and capital gains are all included in the calculation of national income as they represent income generated from the factors of production and economic activities.
Option 4: Wage income
Option 4: Sales tax
Option 3: Dividend income
Option 4: Sales revenue earned by a firm
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile