To Calculate Value Added,we Need to Subtract

question 9

Multiple Choice

To calculate value added,we need to subtract

• A) only the cost of domestically-produced intermediate inputs.
• B) only the cost of foreign-produced intermediate inputs.
• C) the cost of domestic- and foreign-produced intermediate inputs.
• D) total imports.
• E) the cost of all goods and services exported.

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Definitions:

Natural Monopolies

Markets or industries where the production or provision of goods and services is most efficiently carried out by a single provider due to high fixed or startup costs.

Economies of Scale

Economic concept describing the cost advantage that arises with increased output of a product, where the average cost per unit decreases as production scales up.

Production

The process or activity of creating goods and services through the combination of labor, capital, and natural resources.

Economies of Scale Monopoly

A market scenario where a single firm can produce goods at a lower cost per unit due to its large scale of production as compared to smaller competitors.