Question

Imports are subtracted in the expenditure approach to calculating​ GDP, because A. ​consumption, investment, and government spending are understated as these include expenditures on both domestic and foreign goods. B. the U.S. economy is not open to foreign trade. C. ​consumption, investment, and government spending are overstated as these include expenditures on both domestic and foreign goods. D. U.S. has a negative balance of trade.

Answer 1

Answer:The answer is Ca

Explanation:in expenditure approach method of calculating GDP, expenditure on intermediate goods and services such as capital goods and services bought and used for further production must be excluded. This is done in order to avoid double counting.

Therefore, the calculation should be based on expenditure on the monetary value of final goods and services.