Question

11. State with valid reason, which of the following statement is true or false:

a. Gross Value Added at market price and Gross Domestic Product at

market price are one and the same thing.

b. Intermediate goods are always durable in nature.​

Answer 1

Answer:

a) True, as Gross Domestic Product (GDP) of any nation represents the sum total of gross value added (GVA) in all the sectors of that economy during the said year after adjusting for taxes and subsidies.

b)False, as intermediate goods are generally non-durable in nature.

Answer 2

The answer is,

a) True, as Gross Domestic Product (GDP) of any nation represents the sum total of gross value added (GVA) in all the sectors of that economy during the said year after adjusting for taxes and subsidies.

b)False, as intermediate goods are generally non-durable in nature.

Is intermediate goods are always durable in nature?

• Intermediate goods are not durable in nature as they are used as raw materials for production of final goods and therefore lose their identity during the production process.

Which of the following is true about intermediate goods?

• True. Intermediate goods have a derived demand as their demand depends on demand for final goods .
• On the other hand , final goods have a direct demand as they satisfy the wants directly.

Why gross value added at market price and gross domestic product at market price are one and same thing?

• The given statement is false as Gross Domestic Product is the result of sum of Gross Value Added by all the producing units/firms in an economy, during an accounting year.

What is the difference between gross domestic product and gross value added?

• The difference between GVA and GDP is that GVA is the value added to the product to enhance the various aspects of the product whereas GDP is the total amount of products produced in the country.

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