Why is the brokerage paid to the broker during the sale and purchase of shares is included in national income? |
Because we include this in operating surplus Because sale and purchase of shares is added Because brokerage adds to the corresponding flow of goods and service Brokerage paid to the broker during the sale and purchase of shares is included in national income |
Because brokerage adds to the corresponding flow of goods and service |
The correct answer is option 3: Because brokerage adds to the corresponding flow of goods and service Sale of shares itself is not included while calculating the national income. However, the services rendered by the broker is productive in nature i.e. they add to the flow of goods and services in the economy. Brokerage fees are considered part of the service sector and contribute to the national income as they represent payment for the service provided by the broker. Thus, we include it while calculating the national income. |