Question 34
National IncomeWhich of the following is not a component of National Income at factor cost?
- A.Wages earned by doctors
- B.Rent paid to landlords
- C.Indirect taxes
- D.Undistributed company profits
- E.Interest on loans.
Show the answer and explanation
Answer: C (Indirect taxes)
Explanation
Factor cost counts only payments to factors (wages, rent, interest, profit); indirect taxes are not factor incomes.