National Accounts
The factors of production provide "services" which raise the unit price of a product (X) relative to the cost per unit of intermediate goods used up in the production of X.
In national accounts such as the United Nations System of National Accounts (UNSNA) or the United States National Income and Product Accounts (NIPA), gross value added is obtained by deducting intermediate consumption from gross output. Thus gross value added is equal to net output. Net value added is obtained by deducting consumption of fixed capital (or depreciation charges) from gross value added. Net value added therefore equals gross wages, pre-tax profits net of depreciation, and indirect taxes less subsidies.
Read more about this topic: Value Added
Famous quotes containing the words national and/or accounts:
“Mr. Speaker, at a time when the nation is again confronted with necessity for calling its young men into service in the interests of National Security, I cannot see the wisdom of denying our young women the opportunity to serve their country.”
—Lyndon Baines Johnson (1908–1973)
“Genius lasts longer than Beauty. That accounts for the fact that we all take such pains to over-educate ourselves.”
—Oscar Wilde (1854–1900)