What type of income is received from certain financial accounts or lending money to others?

Interest income is the correct answer because it specifically refers to the earnings generated from money that is deposited in financial accounts or the money lent to borrowers. This form of income occurs when a bank, financial institution, or an individual pays you interest for the use of your money over time.

For instance, if you place your money in a savings account, the bank pays you interest for holding your funds. Similarly, when you lend money, such as through a bond or a personal loan, the borrower pays you interest as compensation for the loan.

In contrast, dividend income comes from owning shares in a company and represents a portion of the company’s earnings distributed to shareholders. Capital gains arise from selling an asset at a higher price than what was originally paid for it. Passive income can encompass various types of income streams that do not require active involvement, such as rental income, but it does not specifically refer to income derived from financial accounts or lending.