The Circular Flow Model Shows That GDP Can Be Calculated

question 1

Multiple Choice

The circular flow model shows that GDP can be calculated by

• A) only the expenditure method in which the four components of aggregate expenditure must be measured in the aggregate.
• B) only the income method in which the four components of aggregate income must be measured separately.
• C) both the expenditure and income methods, even though aggregate expenditure is usually less than aggregate income.
• D) both the expenditure and income methods because aggregate expenditure equals aggregate income.

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Definitions:

Spirometer

A device used to measure the volume of air inhaled and exhaled by the lungs.

Total Lung Capacity (TLC)

The maximum amount of air the lungs can contain, typically measured after a maximal inhalation effort.

Spirometer

An instrument used to measure the volume of air inhaled and exhaled by the lungs, assessing pulmonary function.

Functional Residual Capacity (FRC)

The amount of air left in the lungs following a standard breath out.