Question

Export are not a part of 'Net Factor Income from abroad'. Elaborate the reason behind the given statement. 

Answer 1

Exports are not a part of NFIA.

1. The difference between factor income from abroad and factor income to abroad is represented by NFIA. And factor income is the compensation for providing factor services, such as rent, wages and salaries, interest, and profit.
2. Foreign demand (or expenditure on) domestically produced goods and services is represented by exports. As a result, it contributes to GDP.