Question

In the second step of the Expenditure Method, expenditure is classified into:

Options

• Wages, rent, interest and profit

• Output, income, savings and wealth

• \(C, I, G, (X-M)\) and NFIA

• Taxes, subsidies, pensions and profits

Answer 1

Expenditure is classified into \(C\), \(I\), \(G\), \((X-M)\), and NFIA. These categories organize private, investment, government, foreign-trade, and factor-income transactions.