Read the two statements and choose the correct option.
I. The employer's contribution to an employee's provident fund is part of compensation of employees.
II. The employee's own contribution to the provident fund is added again on top of the wage.

Only ICorrect answerYour answerOnly IICorrect answerYour answerBoth I and IICorrect answerYour answerNeither I nor IICorrect answerYour answer

Show the answer and explanation

CorrectNot quiteAnswer A

Correct answer: A

The employer's contribution is a benefit earned by the employee, so I is true.
The employee's contribution is paid out of the wage, which is already counted; adding it again would count it twice. II is false.

Ten questions from Measuring National Income, at your own pace.

Ten questions from Measuring National Income, at your own pace.

Read the two statements and choose the correct option.I. The employer's contribution to an employee's provident fund is part of compensation of employees.II. The employee's own contribution to the provident fund is added again on top of the wage.