Explanation : In economics, distribution theory is the systematic attempt to account for the sharing of the national income among the owners of the factors of production–land, labour, and capital, Traditionally, economists have studied how the costs of these factors and the size of their return–rent, wages, and profits–are fixed. The theory of distribution involves three distinguishable sets of questions. First, how is the national income distributed among persons? Second, what determines the prices of the factors of production? Third, how is the national income distributed proportionally among the factors of production? ....Read more