Which of the following pairs of a factor payment and the service it pays for is correctly matched, as per the NCERT Glossary?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Interest – services provided by capital
Each factor payment pays for the service of one factor: interest for capital, rent for land, wages for labour and profit for entrepreneurship.
Option (1) Interest – services provided by capital — Correct. Interest is the payment for services provided by capital.
Option (2) Rent – services provided by entrepreneurship — Incorrect. Rent pays for the services of land.
Option (3) Wage – services provided by land — Incorrect. A wage pays for the services of labour.
Option (4) Profit – services rendered by labour — Incorrect. Profit pays for the services of entrepreneurship.
NCERT (2026-27): Glossary: “Interest – Payment for services which are provided by capital.” Glossary: “Rent – Payment for services which are provided by land (natural resources).” Glossary: “Wage – Payment for the services which are rendered by labour.” Glossary: “Profit – Payment for the services which are provided by entrepreneurship.” |