Question

QUESTION 58

1. Consumption spending on non-durable goods is just as volatile as consumption spending on durable goods.

   True

   False

1 points   

QUESTION 59

1. The component of spending that is the largest share of GDP is

   		consumption
   		investment
   		government purchases
   		net exports

Answer 1

Question 58
Consumption spending on durable goods such as cars, equipments and machine rise are most volatile than spending on non durable goods such as food, drinks etc which is needed to survive. Hence the economic situation becomes unfavourable, consumer spends less amount on durable goods. Hence the above statement is False.

Question 59

Consumption spending contributes to the largest share of GDP among the four components of GDP i.e Consumption, investment, government purchases and net export. Hence the answer will be:

Consumption