Question

On a trip to the east coast, you discover that the local company has been depressed because of restrictions on fishing. You spend over $3000 on hotels, restaurants, and entertainment. What factors will influence the actual amount by which total GDP rises in the region because of your expenditures?

Answer 1

The expenditure method is a method for calculating gross domestic product (GDP), which totals consumption, investment, government spending and net exports. The expenditure method is the most common way to estimate GDP, and it says everything that the private sector, including consumers and private firms, and government spend within the borders of a particular country, must add up to the total value of all finished goods and services produced over a certain period of time. This method produces nominal GDP, which must then be adjusted for inflation to result in the real GDP.

Consumption factor is influenced due to the expenditured on hotrls, restuarants and entertainment