The reason that indirect business taxes are subtracted from NDP to get NI is that they
A)represent income received but not earned
B)do not represent income to any individual
C)represent income that we earn but do not receive
D)represent investment undertaken merely to replace worn-out capital
E)reflect double counting of intermediate goods

Question

Quizplus · Accepted Answer

Indirect business taxes do not represent income to any individual, as they are collected by the government and not paid out to any specific person or entity. Therefore, they must be subtracted from NDP in order to arrive at NI, which represents the total income earned by individuals and businesses.

The Reason That Indirect Business Taxes Are Subtracted from NDP