Question:
What do you mean by the term ‘Personal Income’?
Author: Vimala BaluAnswer:
Personal income is the total income received by the individuals of a country from all sources before payment of direct taxes in a . Personal income is derived from national income by deducting undistributed corporate profit, and employees’ contributions to social security schemes and adding transfer payment.
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Alternative answers:
Personal income is never equal to the national income, because the former includes the transfer payments whereas they are not included in national income.
Personal Income = National Income
– (Social Security Contribution and
undistributed corporate profits) +
Transfer payments
Author
Vimala Balu