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What is the difference between GDP at factor cost and GDP at market price?
Wiki User
∙ 12y ago
GDP at market price is value of GDP calculated by taking the price and quantities of current year and GDP at basic price refers to GDP calculated by taking the price of base year quantities of current year.
Wiki User
∙ 13y ago
Anonymous
Wiki User
∙ 13y agoPrices.
Market Prices and Factor Cost
Many transactions are subject to taxes and subsidies.
- The expenditure measure uses market prices which include taxes and subsidies.
- The income and output measures are generally reported at factor cost.
Adjustment is needed to compare these measures:GDP at market prices - indirect taxes + subsidies = GDP at factor cost
Current and Constant Prices
An economic variable may have both real and nominal values. The nominal value is expressed at current prices. Therefore, changes of the nominal value over time reflect the impact of two factors: changes in the real size of the economic variable, and changes in the general price level (e.g. inflation). The real value is the value expressed at constant prices (i.e. it has been adjusted for the impact of inflation). Therefore, the real value reflects only the real changes in the economic variable. It is more useful in comparing data at different points in time.
- Output data are generally collected in both current and constant prices.
- Expenditure and income data are mostly collected in current prices and then converted into constant prices using deflators.
GDP deflator is a price index that reveals the cost during the current period of purchasing the items included in GDP relative to the cost during a base year (currently, 1992). Because the base year is assigned a value of 100, as the GDP deflator takes on values greater than 100, it indicates the prices have risen. It is designed to measure the change in the average price of the market basket of goods included in GDP. In addition to consumer goods, the GDP deflator includes prices for capital goods and other goods and services purchased by business and governments.
Sunil P T
Wiki User
∙ 12y agoLess indirect taxes plus subsidies from the government.
Wiki User
∙ 12y agoGDP at factor cost is when GDP is computed at actual cost of its production.
Wiki User
∙ 13y agoGDPfc is GDPmp less indirect taxes plus subsidy
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What is the difference between GNP at market price and GNP at factor cost?
GNP at factor cost refers to income which the factors of production receive in return for their service alone. GNP at FC = GNP at Market Price - Net Indirect Taxes + Subsidies
What is the difference between GNP at market price and GNP at curent price?
No difference. Both are the same.
What is the difference between administered prices and market prices?
administered price means price set by a body outside of the market..And market price is a price set up on basis of demand and supply.
What is the difference between extension and contraction?
Extension is when the price goes up and no other factor changes. Contraction is when the price goes down and no other factor changes.
Explain the difference between market price and normal price?
Price is the value or worth of a product or service and when you say price then it vehicle the normal price of a product or a service which a company charges. On the other hand, market price is the price of a product or service which is contained by a marketplace and is resulted through market efficiency, equilibrium and normal expectations. Normal price can be lesser, equal or greater than the market price. If most of the companies in an industry charge open market prices for the products or services then competition is high in that specific industry.
What is the difference between GNP at market price and GNP at factor cost?
GNP at factor cost refers to income which the factors of production receive in return for their service alone. GNP at FC = GNP at Market Price - Net Indirect Taxes + Subsidies
What is the difference between GNP at market price and GNP at current price?
No difference. Both are the same.
What is the difference between GNP at market price and GNP at curent price?
No difference. Both are the same.
What is the difference between administered prices and market prices?
administered price means price set by a body outside of the market..And market price is a price set up on basis of demand and supply.
What is the difference between extension and contraction?
Extension is when the price goes up and no other factor changes. Contraction is when the price goes down and no other factor changes.
Explain the difference between market price and normal price?
Price is the value or worth of a product or service and when you say price then it vehicle the normal price of a product or a service which a company charges. On the other hand, market price is the price of a product or service which is contained by a marketplace and is resulted through market efficiency, equilibrium and normal expectations. Normal price can be lesser, equal or greater than the market price. If most of the companies in an industry charge open market prices for the products or services then competition is high in that specific industry.
What is customer surplus and producer surplus?
Consumer surplus is the difference between the maximum amount a person is willing to pay for a good and its current market price. Producer surplus is the difference between the current market price and the full cost of production for the firm.
When calculating the cost of capital how should the share premium be calculated?
share premium could be calculated as by getting the difference between the market price of the share and its nominal price. Formula: Share Premium= Market Price - Nominal Price
What is the difference between supply schedule and market schedule?
A table which contains values for the price of a good and the quantity that would be supplied at that price. A market demand schedule is a table that lists the quantity of a good all consumers in a market will buy at every different price.
What is the difference between an imperfect and perfect market?
Perfect markets refer to markets where there is competition and sellers are price takers. An imperfect market refers to markets that have a dominant seller and they are able to set the price.
What is the difference between value and cost?
value is the market price of an item cost in the expense incurred to obtain an item
What is Factor Market?
The market for a factor of production, such as labor or capital, in which supply and demand interact to determine the equilibrium price of the factor.
