The Expenditure Approach
There are four main categories of expenditure:
Personal consumption expenditures (C): household spending on consumer goods
Gross private domestic investment (I): spending by firms and households on new capital, that is, plant, equipment, inventory, and new residential structures
Government consumption and gross investment (G)
Net exports (EX - IM): net spending by the rest of the world, or exports (EX) minus imports (IM)
The Expenditure ApproachThere are four main categories of expenditure: Personal consumption expenditures (C): household spending on consumer goodsGross private domestic investment (I): spending by firms and households on new capital, that is, plant, equipment, inventory, and new residential structuresGovernment consumption and gross investment (G)Net exports (EX - IM): net spending by the rest of the world, or exports (EX) minus imports (IM)
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