Question

What is the total amount of income earned in a country during a year called?

• A. Per capita income
• B. Average income
• C. National income
• D. None of these

Hint:

Remember: Total for the country = {National income}; per person = {Per capita income}.

Answer 1

The Correct Option is C

Step 1: Definition.
National income is the total value of all final goods and services produced (or total factor incomes earned) within a country in a year.
Step 2: Distinction.
Per capita income = national income divided by population; “average income” is an informal term.