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incomemoney received by individuals, firms and other organizations in the form of WAGES, SALARIES, RENT, INTEREST, COMMISSIONS, FEES and PROFIT, together with grants, unemployment benefit, old age pensions, etc. See EARNED INCOME, DISTRIBUTION OF INCOME.
incomemoney received by individuals and firms in the form of WAGES, SALARIES, RENT, INTEREST, PROFIT, etc., together with unemployment benefit, old age pensions, etc. In microeconomic analysis, the term ‘income’ is used specifically to refer to the flow of returns over a period of time from providing FACTORS OF PRODUCTION (NATURAL RESOURCES, LABOUR and CAPITAL) in the form of rent, wages and interest/profit, respectively. In macroeconomic analysis, the term NATIONAL INCOME is used to refer to the aggregate income of a country from rents, wages, interest and payments, excluding TRANSFER PAYMENTS (unemployment benefit, old age pensions, etc.).
More generally, from the point of view of the individuals concerned, any money received counts as income (whether it be from providing factors of production or takes the form of an old age pension, unemployment benefit or other transfer payment). Any such FINAL INCOME is an important determinant of an individual's spending capabilities in the THEORY OF DEMAND. See CIRCULAR FLOW OF NATIONAL INCOME MODEL, DISPOSABLE INCOME, FUNCTIONAL DISTRIBUTION OF INCOME, PERSONAL DISTRIBUTION OF INCOME.
(1) For IRS purposes, income is never precisely defined, but it apparently includes all moneys received from any sources unless specifically excluded by some IRS Code provision. (2) In business, all the revenues derived from the business, less all expenses. Many people use the word income interchangeably with revenues,but revenue implies a gross figure without deductions,and income implies an amount after expenses.