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Mr. Weathers AP Econ 2025
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Know the definition of GDP
The total market value of all final goods & services produced in a country over 1 year
Know the equation of GDP
C+I+G+(X-M)
What is the name of & all parts of the first variable in the GDP equation?
Consumer Spending: consumption & household spending on goods & services
What is the name of & all three parts of the second variable in the GDP equation?
Investment Spending: business purchases of tools/machinery, new construction, changes in business inventory
What is the name of & all parts of the third variable in the GDP equation?
Government Spending: government spending at all levels on goods & services
What is the name of the last group of variables in the GDP equation?
Net Exports: exports minus imports
What are six things not included in GDP
Intermediate goods & services
Black market transactions
Imports
Used goods
Transfer payments
Stocks & bonds