The Term Value Added Is Used to Describe

question 8

Multiple Choice

The term value added is used to describe:

• A)the increase in the value of a product that occurs at each stage of production.
• B)the amount subtracted from the value of goods because of inflation.
• C)the total value of all intermediate goods used in the production of the final good.
• D)the amount paid in the final sale of a product or service.
• E)the amount subtracted from the value of resources because of depreciation.

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Definitions:

Taxes

Mandatory financial charges or levies imposed by a government on individuals or entities to fund public expenditures.

Debt Ratio

A financial ratio that compares a company's total debt to its total assets, indicating the proportion of assets financed with debt.

TIE

Times Interest Earned, a financial ratio that measures a company's ability to meet its debt obligations based on its current income.

Operating Costs

The day-to-day expenses involved with running a business, excluding costs associated with production.