Lecture title - Consumption Expenditure

8 important questions on Lecture title - Consumption Expenditure

What portion of total spending does consumption make up?

It constitutes about two-thirds of total spending.

What is a powerful determinant of planned aggregate expenditure (PAE)?

Consumption is a powerful determinant of PAE.

What counts as consumption?

Consumption includes goods, services, and consumer durables.
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What are examples of goods in consumption?

Examples of goods include clothes, food, and electronics.

What are examples of services in consumption?

Services include transport, healthcare, and entertainment.

What are considered consumer durables?

Consumer durables are items like cars, furniture, and appliances.

Are rent payments part of consumption?

Yes, rent payments are considered services in consumption.

What is excluded from consumption?

New houses are excluded as they count as investment.

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