If C = consumption,G = government expenditures,and I = investment expenditures,the mathematical representation of GDP using the expenditure approach is
A)GDP = C + I + G + Transfers.
B)GDP = C + I + G + Imports.
C)GDP = C + Imports.
D)GDP = C + I + G + Net exports.

Question

Quizplus · Accepted Answer

The mathematical representation of GDP using the expenditure approach is GDP = C + I + G + net exports, which means the total spending on consumption (C), investments (I), government expenditures (G) and net exports (exports - imports) equals GDP. Options A and B are incorrect because they do not include net exports, and option C is incorrect because it only includes consumption and imports.

If C = Consumption,G = Government Expenditures,and I = Investment