Question

(a) The functions of money (b) The components of expenditure (c) Real vs Nominal GDP​

Answer 1

Answer:

A

To summarize, money has taken many forms through the ages, but money consistently has three functions: store of value, unit of account, and medium of exchange. Modern economies use fiat money-money that is neither a commodity nor represented or "backed" by a commodity

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B

There are four main aggregate expenditures that go into calculating GDP: consumption by households, investment by businesses, government spending on goods and services, and net exports, which are equal to exports minus imports of goods and services.

C

Nominal GDP measures output using current prices, but real GDP measures output using constant prices. In this video, we explore how price changes can distort GDP using a visual representation of GDP.