Economic Awareness - Sectors of Indian Economy
Which of the following statements is correct regarding GDP at factor cost and GDP at market price?
Which of the following statements is correct regarding GDP at factor cost and GDP at market price?
medium Q15 of 15
Step-by-Step Solution
Step 1: Understand definitions
GDP at market price includes indirect taxes which increase prices and excludes subsidies which reduce prices.Step 2: Analyze statements
Only GDP at market price includes indirect taxes but excludes subsidies is correct.Final Answer:
GDP at market price includes indirect taxes but excludes subsidies → Option BQuick Check:
MP includes IT excludes subsidies ✅
Quick Trick: Remember: Market Price = Factor Cost + Taxes - Subsidies.
Common Mistakes:
- Confusing inclusion/exclusion of indirect taxes and subsidies in factor cost and market price.
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