Under the income approach, national income is primarily measured by adding incomes earned by factors of production and then accounting for which adjustment?
Correct answer: A. Indirect taxes minus subsidies and depreciation
- A. Indirect taxes minus subsidies and depreciation
- B. Net exports minus private consumption spending
- C. Government transfers minus capital formation
- D. Imports minus exports and inventory changes
Explanation
The income approach adds factor incomes such as wages, rent, interest and profits, with related national accounting adjustments. Indirect taxes less subsidies are included when moving from factor cost to market prices, while depreciation is deducted when a net measure is required.
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About Economy of Pakistan
Pakistan's economy is examined through agriculture, industry, services, trade, remittances, employment, population, poverty and regional development. The topic also covers GDP and national income, inflation, fiscal and monetary policy, taxation, public debt, the balance of payments, energy constraints and structural challenges, including the role of the State Bank and development planning.
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