National income excludes transfer payments, not factor incomes

Steps:

• Recall national income (e.g., GDP or NNP) measures value from production via factor payments like wages, rent, interest, profits.
• Identify choices: A, B, C relate to production earnings; D is a government transfer.
• Apply definition: Inclusions are payments for goods/services or factors; exclusions are unearned transfers.
• Confirm D as the outlier per standard national accounting principles.

Why D is correct:

• Welfare benefits are transfer payments redistributing income without current production, excluded from national income formulas like GDP to avoid double-counting.

Why the others are wrong:

• A: Dividends are profit distributions, a factor income included in national income.
• B: Overtime payments are wages for labor, part of compensation in production measurement.
• C: Rents from government houses are property income, counted as factor earnings.

Final answer: D