1- Three approaches in estimating GDP ?
2-List the five components of GDP?
3-why should the government interfere in economy?
4- how Monetary Policy and Fiscal Policy affects the Economy?
Q1) The three approached in estimating GDP are as follows
(1) Expenditure approach: It is the aggregate spending on all the final goods and services in the year within a country.
GDP = C + I + G + NX
(2) Income approach: It is the aggregate of all the primary income in the economy. Income includes income from labor, capital, land and profits.
GDP = W + R + i + P +IBT + D + F
(3) Value-added approach: It is the aggregate of value fo all goods produced in all the sectors in the economy minus the value fo intermediate goods in all the sectors.
GDP = VOGS – IC
Q2) The core 5 components fo GDP are private consumption, government purchases (and consumption), fixed investment, net exports, and change in inventories.
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