Answer:
To calculate GDP under the income approach, in addition to summing all factor incomes, it is necessary to add indirect taxes and substract subsidies, and it is also necessary to add depreciation expense of capital goods.
In the case of the addition of taxes and substraction of subsidies, this is done in other to get from factor prices, to market prices, since GDP is based on the latter, not on the former.
A depreciation is added in order to get from net domestic product (NDP) to Gross Domestic Product (GDP).
GDP at Market Price aims to calculate the wealth produced by private and public sector in a national territory during a given period.
To Calculate GDP at Market Price we need to add product taxes and production taxes to GDP at Factor Cost, and subtract Product subsidies, and production subsidies from GDP at Factor Cost. The formula is:
GDP MP = GDP FC+ Product taxes + Production tax – Product subsidies – Production subsidies.
Learn more about GDP at Market Price here:
https://brainly.com/question/25790327
