To derive net domestic income at market prices from GDP (income approach),

Name: To derive net domestic income at market prices from GDP (income approach),
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Question

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To derive net domestic income at market prices from GDP using the income approach, depreciation (the wear and tear on capital goods) needs to be subtracted from GDP. This is because depreciation reduces the value of the capital stock, and therefore needs to be accounted for in order to arrive at the net income earned by households and businesses.

To Derive Net Domestic Income at Market Prices from GDP