Question

The value-added is:
sales minus costs of intermediate goods and labor costs.
sales minus labor costs.
sales minus costs of intermediate goods.
sales minus costs of intermediate goods, capital depreciation, and labor costs.

Answer 1

Answer:

The correct answer is letter "C": sales minus costs of intermediate goods.

Explanation:

Value Added is used to describe the extra something a company does to a product that makes it worth more than the cost of its underlying parts. For economists, value-added is the difference between the gross revenue for an industry (sales) and the sum of the labor, materials, and services (intermediate goods) purchased to produce the goods that generated the revenue.