## Monday, January 3, 2011

### POST 11 - Using the 4x3technique

GDI is the amount of goods and services produced in a year, or the value of everything made that year within the country.

$AD = C + I + G + (X-M) \$
where
• $C \$ is consumption (may also be known as consumer spending) = ac + bc(YT),
• $I \$ is Investment,
• $G \$ is Government spending,
• $NX = X - M \$ is Net export,
• $X \$ is total exports, and
• $M \$ is total imports = am + bm(YT).