ECS2603 EXAM REVISION PACK ,Question A1 Gross domestic expenditure Plus exports of goods and services Less imports of goods and services Equals Expenditure on gross domestic product (GDP @ market prices) The diifference between basic prices, factor

ECS2603 EXAM REVISION PACK ,Question A1 Gross domestic expenditure Plus exports of goods and services Less imports of goods and services Equals Expenditure on gross domestic product (GDP @ market prices) The diifference between basic prices, factor cost and market prices can be ascribed to:  These three sets of prices that can be used to calculate GDP.  However market price are used to calculate GDP according to the expenditure method while basic prices are used when production (value added) method is applied. Lastly factor cost is used when the income method id followed. NB** These three methods of calculating GDP will yeild the same result merely if the same set of prices is used in all the calculations. Question A2 a) 442 169 − × 100 = 0.38% Shows an increase of 0.38% b) 1 782 061 − 521 × 100 − 1.79% The negative sign represents a decline in the annual real GDP from 2013 to 2014. Question