List and describe the four components of GDP.
What will be an ideal response?
Consumption expenditures are purchases by consumers of currently produced goods and services, either domestic or foreign. Private investment expenditures are purchases by firms. These include spending on new plants and equipment, newly produced housing and increases in inventory. Government purchases are purchases of newly produced goods and services by federal, state and local governments. They include any goods purchased and the wages and benefits of all government employees. Net exports are net purchases by the foreign sector, which is calculated as domestic exports minus domestic imports.
You might also like to view...
Use the following table to answer the question below. Dave's Production Possibilities SchedulePounds of Green BeansPounds of Corn0160201204080604080 0Dave's production possibilities schedule demonstrates that
A. he can produce as much as he wants. B. he does face scarcity. C. he does not face scarcity. D. he can produce an unlimited amount of green beans if he gives up enough corn.
Refer to the above figure. At a price of two cents, the quantity of bubble gum demanded will be
A) 3. B) 2. C) 4. D) 5.
When the Fed conducts expansionary monetary policy, it __________ in the short run, but __________ in the long run.
A. boosts demand; causes inflation B. causes inflation; boosts output C. causes inflation; boosts economic growth D. boosts demand; boosts supply
Higher price levels will eventually lead to lower interest rates as people reduce their demand for money
a. True b. False Indicate whether the statement is true or false