In the calculation of gross domestic product by the expenditure approach, the "investment" component is

Question

Quizplus · Accepted Answer

The "investment" component in the calculation of GDP by the expenditure approach refers to gross investment, which includes all spending by businesses on business equipment, residential construction, and inventory changes. It does not include depreciation, so options A and B are incorrect. Net investment would be gross investment minus depreciation, which is also not what is included in the "investment" component of GDP. Therefore, the correct answer is C, gross investment.

In the Calculation of Gross Domestic Product by the Expenditure