Value Added Can Be Determined by

question 113

Multiple Choice

Value added can be determined by

• A)subtracting the cost of the intermediate goods from the price of the product at each stage of production.
• B)adding the income of all consumers during the year.
• C)summing the market values of all intermediate goods.
• D)calculating the percentage change in GDP from one year to the next.
• E)dividing GDP by the GDP price deflator.

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Definitions:

Market Valuation

Market valuation is the process of determining the monetary value of a company or asset in the marketplace, typically reflected in its stock price or the total market capitalization.

Direct Method

A cash flow statement presentation that itemizes the major categories of gross cash receipts and payments, providing a clearer view of a company's cash flow from operating activities.

Ending Inventory

The total value of a company's merchandise, raw materials, work-in-progress, and finished goods at the end of an accounting period.

Ceiling Constraint

In accounting, the maximum value that inventory can be reported at, ensuring that assets are not overstated.