Question

Which of the following are sources of Real Income ?
(A) Use of house
(B) Use of cash
(C) Use of vegetables grown in home garden
(D) Use of community facilities like parks

• A. (A), (B) and (D) only.
• B. (B), (C) and (D) only.
• C. (A), (C) and (D) only.
• D. (A), (B) and (C) only.

Hint:

To distinguish between income types, remember: Money Income is the physical cash earned, Real Income is the actual goods and services enjoyed, and Psychic Income is the personal satisfaction derived from them.

Answer 1

The Correct Option is C

Step 1: Understanding the Concept:
Family income is classified into three main types: Money Income, Real Income, and Psychic Income.
Real Income refers to the flow of actual goods, services, and facilities available to a family over a given period.

Step 2: Detailed Explanation:
Let us analyze the components of Real Income:
Real income is divided into two categories:
1. Direct Real Income: Goods and services available to the family without spending money.
2. Indirect Real Income: Goods and services obtained by spending money (e.g., buying food or clothes).
Let us evaluate the options:
- (A) Use of house: Living in a self-owned or rent-free home provides housing services directly without ongoing rental payments, representing direct real income. (True)
- (C) Use of vegetables grown in a home garden: Growing food at home provides fresh produce without cash expenditure, representing direct real income. (True)
- (D) Use of community facilities like parks: Public facilities (such as libraries, parks, and roads) provided by the government or community represent shared real income. (True)
- (B) Use of cash: Cash is a medium of exchange and represents Money Income. It must be spent to be converted into real goods and services, so it is not a direct source of real income.
Therefore, items (A), (C), and (D) are direct sources of Real Income.

Step 3: Final Answer:
The correct option is (A), (C), and (D) only, corresponding to option (C).