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MEASURING A NATION'S INCOME, when judging wether th economy is doing…

- - - - outputs is value at market price
- - - - sex service
      - drugs
      - illegal gambling
- - - - Nondurable Goods
        
        shorter life span(groceries)
      - Durable Goods
        
        consumer investments
        
        keeping them for a sustained duration time(washing machine, automobiles and ovens
      - spending by household on goods and services with the exception of purchases of new house
      - services
        
        medical treatment, laywers and dry cleaners
    - - spending or purchase on capital stock(equipment), inventories so that they can be used to produced other goods and services, including new house
        
        a. Business Investment
        
        actual purchases of goods used in the production process ( offices, factory, machinery, transport and labor)
        
        b. Residential Construction
        
        actual construction of housing, ot sale of homes ( new home that is built during a given years is counted in that year's GDP,)
        
        c. Changes in iventories
        
        firms stockpile raw materials and intermediate goods used in the production process
    - - spending on goods and services by local, state, and federal goverments.
    - - X-M ( imported goods and services were not produced wthin the countryu, so imported goood must be sub tracted from purchase
      - normally use to represent the diffrence between the two activity