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Which of these is NOT the correctly stated component of the expenditure method of measuring national income?
Question

Which of these is NOT the correctly stated component of the expenditure method of measuring national income?

A.

Final investment expenditure by firms

B.

Final government expenditure

C.

Export plus import expenditure

D.

Final consumption expenditure by households
 

Correct option is C

The correct answer is (c)
The expenditure method of measuring national income includes several key components: investment expenditures by businesses (gross fixed capital formation), government expenditures on goods and services, exports minus imports (net exports), and consumption expenditures by households. These components collectively account for the total expenditure in an economy.
The correct statements are:
 Final investment expenditure by firms is correct, as it accounts for gross fixed capital formation.
 Final government expenditure is correct and includes all government spending on final goods and services.
 Final consumption expenditure by households is correct and represents consumer spending on goods and services.
However, option (c) should state "Exports minus imports expenditure" to correctly reflect net exports, which are the difference between a country's exports and imports. Since it incorrectly states "Export plus import expenditure," it does not accurately describe a component of the expenditure method for calculating national income. Therefore, the answer is (c) Export plus import expenditure.
 

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