Economics · National Income Accounting
Consider the following statements regarding Net Factor Income from Abroad (NFIA): Statement I: NFIA is calculated by subtracting factor income paid to the rest of the world from factor income received from the rest of the world. Statement II: If a country has a negative NFIA, its Gross Domestic Product (GDP) will be higher than its Gross National Product (GNP). Statement III: NFIA includes only the trade balance of goods (exports minus imports) and does not account for factor earnings. Which of the above statements are correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Statements I, II and III
- 2Statements II and III only
- 3Statements I and II only✓
- 4Statement I only
Correct answer
Statements I and II only
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