Expenditure and income approach

Expenditure Approach-

• Add up market value of all domestic expenditures made on final goods and services in a single year
• C + Ig + G + Xn = GDP

Budget Formula-

• Government purchases of goods/services + government transferred payments - government tax and fee collection=
• If the budget is a positive number, it is deficit.
• If the budget is a negative number, it is a surplus.

Trade Formula

• Exports - Imports=

How to Find GNP

• GDP + Net Foreign Factor Payment=

NNP (Net National Product)

• GNP - depreciation=

NDP (Net Domestic Product)

• GDP - depreciation National Income (Either Formula Will Work)
  1. GDP - Indirect business taxes - depreciation - net foreign factor payment =
  2. Compensation of employees + proprietor's income + rental income + interest income + corporate profits=

Disposable Personal Income

• National Income - personal household taxes + govt transfer payment=