ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The expenditure approach to calculating gross domestic product (GDP) takes into account the sum of all final goods and services purchased in an economy over a set period of time. That includes all consumer spending, government spending, business investment spending, and net exports.

Detailed explanation-2: -The spending approach to measuring GDP divides spending into four categories: consumption, investment, government purchases, and net exports. GDP is the total of spending on the four categories.

Detailed explanation-3: -Gross domestic product (GDP) is the standard measure of the value added created through the production of goods and services in a country during a certain period. As such, it also measures the income earned from that production, or the total amount spent on final goods and services (less imports).

Detailed explanation-4: -When using the expenditures approach to calculating GDP the components are consumption, investment, government spending, exports, and imports.

Detailed explanation-5: -The four components of gross domestic product are personal consumption, business investment, government spending, and net exports. 1 That tells you what a country is good at producing. GDP is the country’s total economic output for each year. It’s equivalent to what is being spent in that economy.