1.

Find net value added at market price(i) fixed capital good with a life span of 5 years = 15(ii) raw materials = 6(iii)sales = 25(iv) net change in stock = -2(v) taxes on production = 1

Answer»

The NVAMP is 14

Explanation:

The Net VALUE ADDED at Market Price (NVAMP) is computed as:

Net Value added at market price (NVAMP) = Sales + Net Change in Stock - Intermediate Consumption - Consumption of fixed capital

where

Sales is 25

Net Change in stock is -2

Intermediate Consumption involves the non- factor inputs like raw MATERIALS. So, raw materials would be subtracted.

Intermediate consumption is 6

Consumption of fixed capital = 15/5

Consumption of fixed capital = 3

So, putting the values above:

Net Value added at market price (NVAMP) = 25 + (-2) - 6 -3

Net Value added at market price (NVAMP) = 23 -9

Net Value added at market price (NVAMP) = 14

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