Which of the following is an example of passive income?

• A. Salary from a full-time job
• B. Hourly wage from a part-time job
• C. Rental income from a property
• D. Commissions from sales

Answer: (D)

Passive income means money you earn with little ongoing effort after you’ve set it up. Rental income from a property fits this well: once everything is arranged and tenants are in place, you typically collect rent regularly with minimal daily work (especially if you use a property manager). In contrast, a salary from a full-time job and an hourly wage require ongoing work for each paycheck, and commissions depend on continuing sales activity. So the example of passive income is rental income from a property. If you do the property management yourself, it can be more active, but the standard idea is that rental income is the passive type.