Questions: Dynamic Study Modules - Learning: Chapter 4: Monitoring the Value of Production: GDP - Google Chrome kf1.amplifire.com/amp/#s/learn-app/hf/assignment/A4BRM6S4Y Pearson return Simon Kashirangwa Learning: Chapter 4: Monitoring the Value of Production: GDP IIIIIIIIIII 1 IT lll QUESTION In order to measure GDP using the income approach: ANSWER we must add indirect taxes and subtract subsidies. we must subtract subsidies. we must add indirect taxes. IDON'T KNOW YET submit

The answer is we must add indirect taxes and subtract subsidies.

The income approach to measuring GDP involves summing up all the incomes earned in the production of goods and services within a country. This includes wages, rents, interest, and profits. However, to align this with the expenditure approach, adjustments are necessary:

• This is correct. Indirect taxes (such as sales taxes) are added because they are part of the market price of goods and services but not part of the income received by factors of production. Subsidies are subtracted because they are payments made by the government to producers, which reduce the market price of goods and services.

• This is partially correct but incomplete. While subsidies are indeed subtracted, indirect taxes must also be added to align with the expenditure approach.

• This is also partially correct but incomplete. Indirect taxes are added, but subsidies must also be subtracted to accurately measure GDP using the income approach.