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Consider the following statements:
Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector.
Economic growth in India is measured using GDP at factor cost.
Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy.
Which of the statements given above are correct?
- a)1 and 2 only
- b)1 and 3 only
- c)2 and 3 only
- d)1, 2 and 3
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements: Gross value added (GVA) is a ...
The correct answer is option 'B', which states that statements 1 and 3 are correct.
Explanation:
1. Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry, or sector.
- This statement is correct. GVA measures the value of goods and services produced by various sectors of the economy before accounting for taxes and subsidies. It represents the contribution of each sector to the overall GDP.
2. Economic growth in India is measured using GDP at factor cost.
- This statement is incorrect. Economic growth in India is measured using GDP at market prices, not factor cost. GDP at market prices includes indirect taxes and excludes subsidies, while GDP at factor cost includes subsidies and excludes indirect taxes.
3. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy.
- This statement is correct. GDP is the total value of all final goods and services produced within a country's borders in a specific time period. It is calculated by summing up the GVA of all sectors, including agriculture, industry, and services.
To summarize, statement 1 is correct as GVA measures the contribution to GDP made by individual producers, industries, or sectors. Statement 2 is incorrect as economic growth in India is measured using GDP at market prices, not factor cost. Statement 3 is correct as GDP represents the sum of GVA in all sectors of the economy. Therefore, the correct answer is option 'B' - 1 and 3 only.
Explanation:
1. Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry, or sector.
- This statement is correct. GVA measures the value of goods and services produced by various sectors of the economy before accounting for taxes and subsidies. It represents the contribution of each sector to the overall GDP.
2. Economic growth in India is measured using GDP at factor cost.
- This statement is incorrect. Economic growth in India is measured using GDP at market prices, not factor cost. GDP at market prices includes indirect taxes and excludes subsidies, while GDP at factor cost includes subsidies and excludes indirect taxes.
3. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy.
- This statement is correct. GDP is the total value of all final goods and services produced within a country's borders in a specific time period. It is calculated by summing up the GVA of all sectors, including agriculture, industry, and services.
To summarize, statement 1 is correct as GVA measures the contribution to GDP made by individual producers, industries, or sectors. Statement 2 is incorrect as economic growth in India is measured using GDP at market prices, not factor cost. Statement 3 is correct as GDP represents the sum of GVA in all sectors of the economy. Therefore, the correct answer is option 'B' - 1 and 3 only.
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Consider the following statements: Gross value added (GVA) is a ...
Option b is correct.
- Statement 1 is correct: Gross value added (GVA) is defined as the value of output less the value of intermediate consumption. It is used to measure the output or contribution of a particular sector. When such GVAs from all sectors (∑ GVA) are added together and adding taxes (product) and reducing subsidies (product), we can get the GDP (at market price). At its simplest it gives the rupee value of goods and services produced in the economy after deducting the cost of inputs and raw materials used.
- Statement 2 is incorrect: Economic growth was measured as the percent rate of increase in GDP at Factor cost at Constant prices till January 2015 in India. In a major overhaul of the way India’s gross domestic product (GDP) is calculated, the Central Statistics Office (now called as NSO) adopted the international practice of GDP at market price and the Gross value addition measure to better estimate the economic activity.
- Statement 3 is correct: When the value of taxes on products (less subsidies on products) is added to the gross value added, the sum of gross value added for all resident units gives the value of gross domestic product (GDP). Thus, 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.
- Knowledge Base: Technically, GDP at Market Prices = ∑ GVA at basic prices + product taxes – product subsidies. In this context, when GVA from all sectors are added together and necessary adjustment for taxes and subsidies are made, we will get the GDP for the economy.
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Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer?
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Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer?.
Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements: Gross value added (GVA) is a measure of the contribution to GDP made by an individual producer, industry or sector. Economic growth in India is measured using GDP at factor cost. Gross Domestic Product (GDP) of any nation represents the sum of gross value added (GVA) in all the sectors of that economy. Which of the statements given above are correct?a)1 and 2 onlyb)1 and 3 onlyc)2 and 3 onlyd)1, 2 and 3Correct answer is option 'B'. Can you explain this answer?.
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