Question

Gross domestic product is the sum of the value added value produced by the industry category plus depreciation in a given period of time. Is this true and why

Answer 1

GDP calculates for the total value of goods and services produced in an economy at a given period of time. It must be made clear that the output value includes the value added and hence the final output.

The statements take into account only the industry categories which is just a part of calculating the GDP for an economy. The services produced in an economy is the essential part of calculating the GDP. Further depreciation in the economy is a part of the GDP which is being calculated. Although in order to negate the value for depreciation , NEt domestic product ( NDP) is calculated.

Hence the earlier part of statement is false while the later part involving the depreciation is partially true.