Question

Distinguish between Net Factor Income from Abroad (NFIA) and Net Exports (X -- M).

Hint:

NFIA relates to income flows from factors of production; Net Exports covers trade in goods and services.

Answer 1

NFIA	Net Exports (X – M)
This represents income earned domestically from foreign sources minus income paid domestically to foreign sources.	This is calculated as the value of exported goods and services minus the value of imported goods and services.
Encompasses all wages, rent, interest, and profits flowing into or out of the country.	Covers all trade, both tangible goods and intangible services.
A constituent element of National Income.	A constituent element of Domestic Product.