Question:
To arrive at the value of Net Value Added at Market Price (NVA$_{MP}$), ....... must be ....... to/from Gross Value Added at Market Price (GVA$_{MP}$). (Choose the correct option to fill in the blanks)
To arrive at the value of Net Value Added at Market Price (NVA$_{MP}$), ....... must be ....... to/from Gross Value Added at Market Price (GVA$_{MP}$). (Choose the correct option to fill in the blanks)
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When calculating NVA$_{MP}$, always remember that net indirect taxes are added to GVA$_{MP}$, while depreciation is typically subtracted in other calculations like GDP at constant prices.
Updated On: Jun 30, 2025
- Depreciation, added
- Depreciation, subtracted
- Net indirect taxes, subtracted
- Net indirect taxes, added
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The Correct Option is D
Solution and Explanation
To calculate Net Value Added at Market Price (NVA$_{MP}$), we need to adjust Gross Value Added at Market Price (GVA$_{MP}$) by considering the net indirect taxes. Net indirect taxes (taxes minus subsidies) are added to GVA$_{MP}$ to arrive at NVA$_{MP}$, as they are considered part of the value created in the economy that affects the market price of output.
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