Which of the following is a component of GDP?

• A. Consumption (Household Spending)
• B. Unemployment Rate
• C. Money Supply
• D. Government Budget Deficit

Answer: (A)

GDP measures the total value of final goods and services produced, and it is broken down into major spending categories. Household spending on goods and services—consumption—is a primary part of this total. It directly adds to GDP as money people spend on everything from groceries to healthcare to cars, and in most economies it is the largest component.

The unemployment rate is a labor-market statistic, not a measure of spending. The money supply is a monetary metric, not a component of GDP. The government budget deficit is a fiscal outcome describing how much government spending exceeds tax revenue; while government purchases are included in GDP, the deficit itself isn’t a GDP component.