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Which equation correctly states the EXPENDITURE method of GDP at market prices?
AGDP_MP = GNP − NFIA
BGDP_MP = C + I + G + (X − M)
CGDP_MP = C + S + T
DGDP_MP = W + R + Π + Interest
Answer & Solution
Correct answer: B. GDP_MP = C + I + G + (X − M)
GDP_MP = Private final consumption (C) + Investment (I) + Government final consumption (G) + Net exports (X−M). The W+R+Π form is the INCOME method.
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