According to the income approach to GDP, the largest percentage of GDP comes from:
A) indirect business taxes.
B) firm profits.
C) compensation to employees.
D) depreciation of fixed capital.
E) None of these answers is correct.

Question

Quizplus · Accepted Answer

The income approach to GDP calculates the total income earned by everyone involved in the production of goods and services. This includes compensation to employees, which makes up the largest percentage of GDP. Indirect business taxes, firm profits, and depreciation of fixed capital are also included in the income approach, but they make up a smaller percentage of GDP. Therefore, the best choice is C, compensation to employees.

According to the Income Approach to GDP, the Largest Percentage