Source:Bureau of Economic AnalysisBureau of Economic Analysis Consumer Spending by Type, 2002 (in billions) Total consumption by U.S. households in 2002.

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Presentation transcript:

Source:Bureau of Economic AnalysisBureau of Economic Analysis Consumer Spending by Type, 2002 (in billions) Total consumption by U.S. households in 2002 was a $7.3 trillion

Two Approaches to Measuring GDP, 2002 (all data in billions of dollars) Note: These figure are subject to revision Source: Bureau of Economic AnalysisBureau of Economic Analysis

From National Income to Disposable Income, 2002 (all data in billions) Note: These figure are subject to revision Source: Bureau of Economic AnalysisBureau of Economic Analysis

Personal disposable income is a good measure of the spending power of the household sector

Measuring GDP: A Summary Expenditure Approach: GDP = C + I + G + NX Value-Added Approach: GDP = Sum of value added created by all firms Factor payments approach: GDP = Sum of factor payments made by all firms = wages and salaries + interest + rent + profit = National Income