The Largest Expenditure Component of GDP Is

question 91

Multiple Choice

The largest expenditure component of GDP is

• A) government purchases.
• B) personal consumption expenditures.
• C) gross private domestic investment.
• D) net exports.

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Definitions:

Actual Sales

The total revenue a company generates from selling its goods or services, as opposed to projected or forecasted sales.

Contribution Margin Ratio

A measurement that shows the percentage of sales revenue that exceeds variable costs, indicating how much contributes to fixed costs and profits.

Fixed Costs

Regular costs that do not vary with the scale of production or sales activities, encompassing rent, salary disbursements, and insurance contributions.

Target Net Income

The desired profit that a company aims to achieve within a specific period, often used in budgeting and planning.