What is the effect of decreasing these three components(following) on real GDP separately?
1)consumer sentiment - goes down...what happen to real GDP?
2)machinery orders - goes down...what happen to real GDP?
3)exports - expected to go down...what happen to real GDP?
WHY?!
1
Expert's answer
2013-05-16T08:43:25-0400
1)consumer sentiment - goes down, then real GDP decreases, as consumption fall, as it is one of the main components of GDP (cost method of calculation).
2)machinery orders - goes down, then real GDP goes down, as production fall and less goods are produced in the country.
3)exports - expected to go down, then real GDP goes down, as net imports decrease, as it is one of the main components of GDP (cost method of calculation).
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