Which equation is the BEST one for GDP?
A) GDP = C+ I + G - X + IM
B) GDP = C + I + G + X - IM
C) GDP = C + I + G + taxes - value added
D) GDP = C + I + G + taxes + X + IM

Question

Quizplus · Accepted Answer

The equation for GDP should include all components of national spending, namely consumption (C), investment (I), government spending (G), exports (X), and imports (IM). The correct formula is GDP = C + I + G + X - IM, which takes into account both domestic consumption and investment, as well as foreign trade.

Which Equation Is the BEST One for GDP