One Key Difference Between National Income and Net Domestic Product

question 365

Multiple Choice

One key difference between national income and net domestic product is

• A) net domestic product does not include income earned by the factors of production while national income does.
• B) net domestic product represents income that is available to individuals while national income does not.
• C) net domestic product includes indirect business taxes and transfers while national income does not.
• D) net domestic product only includes the net additions to the economy's stock of capital while national income does not.

---

Definitions:

Trade Agreement

A treaty or pact between two or more nations that outlines how they will work together to ensure mutual benefits in trade.

Royalty

A payment made to the owner of certain types of property, such as patents or copyrights, for the right to use that property.

International Monetary Fund (IMF)

Organization established in 1947 to promote trade among member nations by eliminating trade barriers and fostering financial cooperation.