Lesson 11 Final Consumption Spending by Households TDBS Economics Grade 11 by Carden Madzokere
Channel: Carden Madzokere
Date: 2021-02-15

Model equation for GDP: C+G+I+(X-M) where C = Consumption Spending by Households, G = Government Spending, I = Gross Capital Formation, X = Exports, and M = Imports.
Consumption function: C=c0+c1Yd (Where C = Consumption Spending, c0 = Autonomous Consumption, c1 = mpc and Yd = disposable income)
Households spend on goods (durable, non-durable and semi-durable) and services.