The Components of the Expenditure Approach to Measuring GDP Include

question 202

Multiple Choice

The components of the expenditure approach to measuring GDP include all of the following EXCEPT

• A) government expenditure on goods and services.
• B) investment.
• C) net exports.
• D) the implicit payments for unpaid household work.

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Definitions:

Laspeyres Price Index

An economic index that calculates the change in the price level of a basket of goods and services based on the prices and quantities consumed in a base period.

Consumptions

The process of using goods and services to satisfy wants or needs, often measured as an important component of economic activity.

Base Year

A base year is a specific year against which economic growth is measured, often used as a reference point for the calculation of index numbers.

Initial Endowment

The initial quantity of goods, services, wealth, or resources that an individual or entity possesses.