Value Added Refers to

question 108

Multiple Choice

Value added refers to

• A)any increase in GDP that has been adjusted for adverse environmental effects.
• B)the excess of gross investment over net investment.
• C)the difference between the value of a firm's output and the value of the inputs it has purchased from others.
• D)the portion of any increase in GDP that is caused by inflation as opposed to an increase in real output.

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Definitions:

GAAP

Generally Accepted Accounting Principles, which are a collection of commonly-followed accounting rules and standards for financial reporting.

Research and Development

The investigative activities a business conducts to improve existing products and procedures or to lead to the development of new products and procedures.

Write-down

An accounting procedure reducing the book value of an asset when its market value drops below the recorded cost, resulting in a non-cash expense.

Impaired Asset

An asset that has a market value less than its carrying value on the balance sheet, indicating that it may not generate future benefits worth its listed value.