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The GDP Expenditures Equation: What Is GDP and How Do We Measure It?

In this lesson, students learn the definition of gross domestic product (GDP) and the composition of the expenditure categories of GDP. They participate in an active learning demonstration of the GDP expenditure equation [GDP = C + I + G + (X – M)] to understand the relationships among the variables and the effect of changes in aggregate spending on GDP. Special attention is given to the effect that imports have on GDP.

•  Lesson (pdf)

•  PowerPoint slides (pptx)

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Audience:   College, High School
Language:   English
Subjects:   Economics, AP
Resource Types:   Lessons, PowerPoint
Concepts:   Gross Domestic Product (GDP), Business Cycle