Question

What is the relation between G.D.P. at market price and G.V.A.?

Hint:

GVA represents the economic value added by production, while GDP includes taxes and subtracts subsidies.

Answer 1

Step 1: Define GDP and GVA.
- **GDP (Gross Domestic Product)** at market price is the total value of all goods and services produced within a country's borders, valued at current market prices. - **GVA (Gross Value Added)** is the value of goods and services produced in an economy, minus the cost of inputs and raw materials that are directly attributable to that production.
Step 2: Relationship between GDP and GVA.
The relationship between GDP at market price and GVA is given by the formula: \[ \text{GDP at market price} = \text{GVA} + \text{Taxes on production} - \text{Subsidies on production} \] Here, GDP is the total value produced in an economy, and GVA accounts for the value added by industries.
Step 3: Conclusion.
Thus, GDP at market price is derived from GVA by adding taxes and subtracting subsidies on production. Final Answer: \[ \boxed{\text{GDP at market price = GVA + Taxes - Subsidies.}} \]