ECONOMICS
ECONOMIC GROWTH
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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True
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False
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Either A or B
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None of the above
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Detailed explanation-1: -5. The four components of GDP are consumption, such as the purchase of a music CD; investment, such as the purchase of a computer by a business; government purchases, such as an order for military aircraft; and net exports, such as the sale of American wheat to Russia. (Many other examples are possible.) 6.
Detailed explanation-2: -Consumption: Refers to personal or consumer expenditures. In other words, it measures the dollar value of goods and services purchased by consumers. These items would include food, clothing, and landscaping services. Any new purchases by consumers can be counted as part of the GDP.
Detailed explanation-3: -an approach to calculating GDP that involves adding up all of the income earned within the borders of a country in a given year; the income approach adds up wages, rents, interest, and profits.