10 Questions
What is the relationship between total expenditure and total income?
Total expenditure equals total income
What is the formula for GDP using the Expenditure Approach?
Y = C + I + G + NX
What is not included in GDP?
Expenditure on used goods
What is the purpose of the Income Approach in measuring GDP?
To sum the incomes that firms pay households for the factors of production they hire
What is the term for goods or services used as a component of a final good or service?
Intermediate goods
What is the name of the diagram that shows the circular flow of income and expenditure?
Circular Flow of Income
What is the component of GDP that represents the value of goods and services produced by a country but sold to other countries?
Net exports
Why are financial assets not included in GDP?
Households are making loans, not buying goods and services
What is the term for the total value of goods and services produced within a country?
Gross Domestic Product (GDP)
What is the equation that represents the income side of the circular flow of income?
Y = C + S + NT
Test your knowledge on the concepts of GDP, Income, and Expenditure components, including consumption expenditure, investment, and circular flows in the economy. Learn about the different components of GDP and how they are calculated.
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