Question

How does money help in the distribution of national income?

How does money act as distribution of national income?

Answer 1

1. Money facilitates the distribution of national income among people. The total output of a country is jointly produced by different factors of production.
2. So this will have to be distributed among them. Money helps in the distribution of national product through the system of factor prices, e.g., wage, rent, interest and profit, which are expressed in money terms.