distinguish between factor payments and transfer payments? (4 points)
Factor Payments are made of scarce resources, or the factors of production in return for productive services. They are also categorized according to the services of labour ,these are paid as wages for service of labour , interest is paid for the service of capital , rent is paid for the for the service provided by land and profit is for the factor of payement to entreprenurship
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Transfer payements are payments made without rendering any goods or services in return
eg., old age pension, scholarship, gifts, etc.
These are unilateral payments ( Or receipts )
These are not included in the national income