The major item that must be added to national income to obtain GDP is
A) individual income taxes.
B) property taxes.
C) capital consumption allowance.
D) Social Security payments.

Question

Quizplus · Accepted Answer

The correct answer is capital consumption allowance, which represents the amount of capital that has been used up in the production process during the year. It is also known as depreciation. Individual income taxes, property taxes, and Social Security payments are not included in GDP because they represent transfers of money rather than production of goods and services.

The Major Item That Must Be Added to National Income