ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Economists define four factors of production: land, labor, capital and entrepreneurship. These can be considered the building blocks of an economy. How these factors are combined determines the success or failure of the outcome.

Detailed explanation-2: -Personal income is the amount of money collectively received by the inhabitants of a country. Sources of personal income include money earned from employment, dividends and distributions paid by investments, rents derived from property ownership, and profit sharing from businesses.

Detailed explanation-3: -Income provides economic resources that shape choices about housing, education, child care, food, medical care, and more. Wealth, the accumulation of savings and assets, helps cushion and protect us in times of economic distress.

Detailed explanation-4: -In such a situation a distortion-free redistribution of assets and income tends to raise the average productivity of investment. Thus through this mechanism, a more equal distribution of income stimulates economic growth.