Question

Classify the following as factor income or transfer income:
(i) Unemployment allowances.
(ii) Salary received by Rakesh from a company.
(iii) Financial help to earthquake victims.
(iv) Compensation received from the employer.
(v) Claim received from Insurance company by an injured worker.
(vi) Birthday gift received from a friend.
(vii) Bonus received on Diwali.

Answer 1

The following are classified as:

Factor Income: (ii), (iv), (vii)
Transfer Income: (i), (v), (vi), (iii)