1. Famous Economic Formula
GDP= C+I +G+(X-M)
C= Personal Consumption expenditures (consumer spending). This includes all durable goods (a lifetime of more than one year), non-durable goods ( a lifetime of less than one year), and services.

2. I
I = Gross Investment. This is the total value of all capital goods produced in a given nation during one year. Economists divide gross investment into two subcategories:
A. Fixed investment (Building, machinery, equipment)
B. Inventory investment (raw materials, intermediate goods, final goods)

3. G, X, M
G = Government purchases. This is the dollar amount that federal, state, and local governments spend on things like highways, education, defense, etc.
X = Net Exports. This is the value of goods and services produced domestically but sold in other countries.
M = Net Imports. This is the value of goods and services produced in other countries, but bought domestically.

4. Using the figures for 1995, calculate the GDP for that year.
1995: C=4.9 I =1.1 G=1.4 X-M= -.1
7.3 billion