ECONOMICS
GDP
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Income approach
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Output approach
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Expenditure approach
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None of the above
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Detailed explanation-1: -The value-added method is used to calculate the national income in different stages of production in the circular flow. It represents the contribution (value-added) for each producing unit in the production process.
Detailed explanation-2: -The National Income Approach measures GDP as the sum of income generated by production, which is equivalent to total Value Added in IMPLAN.
Detailed explanation-3: -Income method In the income method, the national income is measured by adding up the pretax income generated by the individuals and companies in the economy. It consists of income from wages, rent of buildings and land, interest on capital, profits, etc. in an accounting year.
Detailed explanation-4: -When using the expenditures approach to calculating GDP the components are consumption, investment, government spending, exports, and imports.
Detailed explanation-5: -The production, or value added, approach consists of summing the gross value added of all industries (resident sectors). For each industry, this involves first determining its output and then subtracting the goods and services that were used up in the process of generating that output.