Measuring GDP: The Expenditure Approach Explained

How is GDP really measured? The most common method is the Expenditure Approach, which adds up all spending on goods and services (C + I + Gp + X – IM) to show how much an economy produces.

Economists use this approach because sales are reported to governments, and the true value of a good is only known when it’s sold in the market.

In this video, we break down how the Expenditure Approach works, why it’s used, and what GDP actually tells us about an economy.

Видео Measuring GDP: The Expenditure Approach Explained канала Econbusters