In order to determine GDP using the expenditures approach, all spending on final goods and services, not intermediate goods, is added up.
The total of all final products and services purchased in an economy during a predetermined time period is taken into account when computing gross domestic product (GDP) using the expenditure method.
All consumer expenditure, government spending, corporate investment spending, and net exports are included in this.
Since they both employ the same formula, the final GDP is quantitatively identical to aggregate demand.
The GDP Expenditure Formula is:-
GDP equals C + I + G + (X - M)
C stands for consumer expenditures on goods and services.
I stands for Investment in equipment for businesses.
G is for the government's expenditures on public goods and services.
X is for exports.
And M means import.
Hence, In order to determine GDP using the expenditures approach, all spending on final goods and services, not intermediate goods, is added up.
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