GDP is the value of consumption spending _____ investment spending _____ government purchases _____ the value of exports _____ spending on imports.

Question

Quizplus · Accepted Answer

- Consumption spending and government purchases are both included in GDP and their values are added (plus).
- Investment spending is also included in GDP, but it is substracted (minus) since it is considered a form of intermediate consumption needed to produce goods and services.
- The value of exports is added to GDP, while the value of imports is substracted (minus) since they represent goods and services produced in other countries that were not produced domestically. Therefore, the correct sequence should be:
GDP = Consumption Spending + Government Purchases + Exports - Imports

GDP Is the Value of Consumption Spending _____ Investment Spending