Home › Karnataka PUC II › economics › national_income_accounting › The Value-Added Method calculates national incom…
The Value-Added Method calculates national income by
ASubtracting savings from total expenditure
BSumming the market value of all goods and services sold
CSumming the value added (output − intermediate consumption) at each stage of production across all firms
DSumming wages only
Answer & Solution
Correct answer: C. Summing the value added (output − intermediate consumption) at each stage of production across all firms
Value Added = Value of output − Intermediate consumption, summed across all producing units. Equivalent to GDP_MP at the aggregate level.
Related questions
GDP and welfare are NOT identical because GDPWhy is NNP at FACTOR COST (rather than at market prices) called the National Income?If GDP at market prices = ₹500, depreciation = ₹50, net indirect taxes = ₹40, NFIA = ₹10, Which equation correctly states the EXPENDITURE method of GDP at market prices?Which is a TRANSFER payment in the macroeconomic framework?Personal Disposable Income (PDI) equalsIf NDP at factor cost is ₹100 lakh and net indirect taxes are ₹15 lakh, NDP at market pricWhich of the following is INCLUDED in GDP?