What is the correct national-income reasoning for excluding a scholarship from GNP?
Answer and explanation
Correct answer: It is educational assistance, not factor income from current production
A scholarship is generally a transfer receipt or financial assistance. It is not a payment made as a reward for supplying labour, land, capital, or entrepreneurship in current production. National product measures current production and the factor incomes generated by it; merely transferring purchasing power from one party to another does not create additional output, so the scholarship itself is excluded.
Frequently asked questions
What is the correct answer to this question?
It is educational assistance, not factor income from current production
Why is this the correct answer?
A scholarship is generally a transfer receipt or financial assistance. It is not a payment made as a reward for supplying labour, land, capital, or entrepreneurship in current production. National product measures current production and the factor incomes generated by it; merely transferring purchasing power from one party to another does not create additional output, so the scholarship itself is excluded.
Which subject and chapter does this question cover?
This is a Class 11 Economics question. Chapter: National Income and Related Aggregates.
Student feedback
Was this question useful?
👍 0 Helpful 👎 0 Not helpful
Yes 0% No 0%
0 responsesStudent Reviews
No published reviews yet.
