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Essay Details:
Essay text:
Expenditure approach
B. Income approach
A. Expenditure approach
Expenditure approach is sum of four factors or components-
1. Personal consumption expenditure(C)
2. Gross domestic private investment(I)
3. Government expenditure and investment(G)
4. Net exports(Export earnings-Import payments)which is denoted by X-M
In equation form, we may write
GDP = C + I + G + X - M
1. Personal consumption expenditure(C)
I. Durable goods such as automobiles and furniture’s
II. Non- durable goods such as vegetables and fruits
III. Services such as doctors fee
2. Gross domestic private investment (I)
It is consist of three categories-
I...
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