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Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.?
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Which of the following is not included in national income a) Payment o...
Not included in national income
There are certain payments that are not included in national income. These include:
- Transfer payments: These are payments made by the government to individuals or businesses without any exchange of goods or services. Examples include social security payments, welfare payments, and subsidies. These payments are not included in national income because they do not represent new production.
- Second-hand sales: These are sales of used goods. Since the goods were already produced and sold in a previous period, they do not represent new production and are not included in national income.
- Financial transactions: These include payments of interest, dividends, and capital gains. While these payments represent income to the recipient, they do not represent new production and are not included in national income.
Answer
The correct answer to the question is option c) Interest paid by an individual on a car loan taken from a bank. This is because it is a financial transaction and not a new production. The payment of interest on a car loan does not represent new production and is not included in national income. The other options, payment of interest by a private firm and payment of interest by banks on deposits, are also financial transactions but they are included in national income.
In summary, national income includes only new production of goods and services. Payments that do not represent new production, such as transfer payments, second-hand sales, and financial transactions, are not included in national income.
There are certain payments that are not included in national income. These include:
- Transfer payments: These are payments made by the government to individuals or businesses without any exchange of goods or services. Examples include social security payments, welfare payments, and subsidies. These payments are not included in national income because they do not represent new production.
- Second-hand sales: These are sales of used goods. Since the goods were already produced and sold in a previous period, they do not represent new production and are not included in national income.
- Financial transactions: These include payments of interest, dividends, and capital gains. While these payments represent income to the recipient, they do not represent new production and are not included in national income.
Answer
The correct answer to the question is option c) Interest paid by an individual on a car loan taken from a bank. This is because it is a financial transaction and not a new production. The payment of interest on a car loan does not represent new production and is not included in national income. The other options, payment of interest by a private firm and payment of interest by banks on deposits, are also financial transactions but they are included in national income.
In summary, national income includes only new production of goods and services. Payments that do not represent new production, such as transfer payments, second-hand sales, and financial transactions, are not included in national income.
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Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.?
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Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.?.
Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Which of the following is not included in national income a) Payment of interest by a private firm b) Payment of interest by banks on deposits c) Interest paid by an individual on a car loan taken from bank d) None of the above.?.
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