The Difference Between Net Domestic Product and National Income Is

question 104

Multiple Choice

The difference between net domestic product and national income is that

• A)net domestic product includes depreciation.
• B)national income includes government and business transfer payments.
• C)net domestic product includes indirect business taxes.
• D)net domestic product doesn't include social security taxes or corporate retained earnings.

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Definitions:

Conversion Costs

The combination of labor and manufacturing overhead costs that are incurred to convert raw materials into finished goods.

Ending Work in Process

This refers to the goods that are still in the production process at the end of an accounting period but have not yet been completed.

Total Units

The aggregate quantity of units produced, held in inventory, or sold by a business.

Transferred Out

In cost accounting, refers to the cost of goods or inventory items that have been moved from one production process or department to another.