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Answer : 4. "Undistributed Profits"
Which one of the following is not included while estimating National Income through income method?
5Q:
Which one of the following is not included while estimating National Income through income method?
- 1Rentfalse
- 2Mixed Incomefalse
- 3Pensionfalse
- 4Undistributed Profitstrue
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Answer : 4. "Undistributed Profits"
Explanation :
Income method measures National Income from the side of payments made to the primary factor of production for their productive services in an accounting year.
The components of factor income are (i) Employee’s Compensation, (ii) Profit, (iii) Rent, (iv) Interest, (v) Mixed income and (vi) Royalty.
Profit, rent, interest and other mixed income are jointly known as operating surplus.