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Calculate Gross Value Added at Factor Cost - Economics

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Calculate Gross Value Added at Factor Cost:

i Units of output sold (units) 1,000
ii Price per unit of output (Rs) 30
iii. Depreciation (Rs) 1,000
iv. Intermediate cost (Rs) 12,000
v. Closing stock (Rs) 3,000
vi. Opening stock (Rs) 2,000
vii. Excise (Rs) 2,500
viii. Sales tax (Rs) 3,500

 

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Solution

Gross Value Added at Factor Cost (GVAFC) = Total Value of Sales + Change in Stock − Intermediate Consumption − Net Indirect Taxes

⇒ GVAFC (or GDPFC) = (1000 × 30) + (3000 − 2000) − 12000 − (3500 + 2500)
Or GVAFC = Rs13,000

Concept: Aggregates Related to National Income - Gross Value Added and Net Value Added
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