Which income type involves no exchange of labor for money?

Unearned income is correctly identified as the type of income that does not require an exchange of labor for money. This form of income typically arises from sources such as investments, government benefits, interest, dividends, and rental income from property that is held without active management or significant effort.

In contrast, earned income is derived from working and providing labor or services. Realized income, while not a standard term commonly used in personal finance or taxation, often refers to income that is recognized upon completion of a transaction that generates profit. Passive income, although similar, generally involves some initial effort or investment, even if it does not require active involvement after the initial setup, such as earnings from a rental property being managed by a property management company.

Thus, unearned income stands out as the category that inherently lacks a direct labor exchange, making it the correct choice.