The equation for GDP using the expenditure approach is
A) GDP = C + I + G + EX - IM.
B) GDP = C + I + G + (IM - EX).
C) GDP = C + I + G + EX + IM.
D) GDP = C + I + G - EX - IM.

Question

Quizplus · Accepted Answer

The correct equation for GDP using the expenditure approach is GDP = C (consumption) + I (investment) + G (government spending) + EX (exports) - IM (imports). This is because GDP is calculated as the total value of goods and services produced within a country's borders, and this equation takes into account all of the major components of expenditure in the economy. Option A is the only choice that includes all of these components in the correct order.

The Equation for GDP Using the Expenditure Approach Is