What are aggregated expenses?

Aggregated expenditure is an economic measure that is the sum of four components: consumption, investment, net exports and government expenditure. Models that include aggregated expenses are fiscal models, which means that they predict the effects that have economy expenses. Governments use these models to try to understand the consequences that have their politicians in the economy. They complement the main summary of the equation with other equations that show the relationship between the components of aggregated expenditure. They represent other variables, such as the marginal inclination and a reserve requirement to explain the behavior that transfers economic conditions into these components. Consumption concerns all the money people spend on consumer goods. This includes durable and unusual goods. The consumption supplement is savings, which is the amount of money people decide to postpone savings accounts. It also includes money that is spent on personal investment in financial products. The percentage of one -off income that people spend on consumption expressed asThe decimal number is called a marginal tendency to consume, and the percentage that people save are called a marginal slope to savings - these numbers must be added to one.

Many people think that financial investments when they hear the word "investment", but in total expenditure models, investment concerns capital investments. These are money spent on the construction of factories, buying new equipment and construction of new houses. The investment depends on the level of interest rate, as this rate determines how profitable investment is. People can get an interest rate by putting money into savings, including financial products, so the interest rate provides a minimum profitability threshold. People will only invest in projects if they offer higher income than the interest rate, so WSPEPIC is lower, more projects are undergoing this test and the investment is higher.

pure exports are the total export of land minus total toVoz. This is shown in the current account. If the country imports more products than exports, this number will be negative.

Government expenditure is an instrument that governments use to enact fiscal policy. Using aggregated expenditure models, the creators of politicians study reverberations throughout the economy. Models are needed because the expenditure adds a higher amount of aggregated expenditure than the amount of actual expenditure: adding equals equal to expenditure multiplied by a factor called a multiplier of money.

MULTIPER MONEY measures how far every government dollar goes. Most government expenditure goes to wages. The increased wage is reflected in increased consumption and savings. The money saved is often in banks that can lend more money than they take according to their reserve requirements. The money they lend is on investment and more wages, and aggregated expenses grow every step.