Multiple choice general knowledge

Which among the following comes under factor payment?

  1. Purchase of a Tractor

  2. Electricity Charges for running a tube well

  3. Interest paid to a bank for crop loan

  4. Purchase of tools
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Factor payments are payments made to the factors of production (land, labor, capital, entrepreneurship) for their productive services. Interest paid to a bank for a crop loan is payment for capital, hence a factor payment. The other options (tractor, electricity, tools) are intermediate consumption expenditures, not factor payments.

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