ECONOMICS
BUSINESS CYCLES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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adding up the cost of goods used in producing the item
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subtracting all costs from total revenue
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adding consumption + investment +government spending+ (exports sold-imports bought)
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None of the above
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Detailed explanation-1: -The formula for calculating GDP with the expenditure approach is the following: GDP = private consumption + gross private investment + government investment + government spending + (exports – imports). GDP is usually calculated by the national statistical agency of the country following the international standard.
Detailed explanation-2: -When using the expenditures approach to calculating GDP the components are consumption, investment, government spending, exports, and imports.
Detailed explanation-3: -GDP = GDP at market price – depreciation + NFIA (net factor income from abroad) – net indirect taxes. Income Approach : The Income approach of GDP calculation is based on the total output of a nation with the total factor income received by residents or citizens of a nation.
Detailed explanation-4: -The Output Method (all value added by each producer), The Income Method (all income generated) and. The Expenditure Method (all spending).