Which of the following statements is true?
A) Indirect business taxes are a component of national income because when added to the other components of national income,the sum must equal GDP.
B) Indirect business taxes must be subtracted from national income to yield a figure equal to GDP.
C) Indirect business taxes are a part of national income because they are considered a payment to a factor of production.
D) Indirect business taxes are not part of national income because they are not considered a payment to a factor of production.

Question

Quizplus · Accepted Answer

Indirect business taxes are not considered a part of national income because they do not represent payments made for the use of factors of production. Instead, they are taxes on production, sales, imports, etc., and are collected by the government from businesses, making them distinct from the earnings of labor, capital, or entrepreneurship, which constitute national income.

Which of the Following Statements Is True