That part of profits earned by private and government owned firms which is not distributed among the factors of production is called:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Undistributed profits
Firms keep back a part of their profits and do not pay it to the factors of production. This part is called undistributed profits.
NCERT (2026-27): Glossary: “Undistributed profits – That part of profits earned by the private and government owned firms which are not distributed among the factors of production.” |