When Calculating GDP Using the Expenditure Approach, the Investment Component

question 3

Multiple Choice

When calculating GDP using the expenditure approach, the investment component includes

• A)net investment plus depreciation.
• B)gross investment plus depreciation.
• C)fixed investment minus depreciation.
• D)net investment only.
• E)net investment minus depreciation.

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Definitions:

Federal Government

The national government of a federation that has specific powers over matters that affect the entire country.

Defense

Activities related to protecting a country against external aggression, threats, and maintaining military forces.

Taxable Incomes

The portion of an individual's or corporation's income used to determine how much tax is owed to the government.

Tax Bracket

A range of incomes taxed at a given rate, used in a progressive tax system to ensure fairness.