INVENTORIES IN GDP: A CLASSROOM LEARNING STRATEGY
Keywords:GDP, Inventories, Spending, Teaching Strategy
The Gross Domestic Product (GDP) is a component of macroeconomics courses that is widely used by economists and the society alike. However, many students find it difficult to understand what GDP encompasses. The understanding of the concept can be facilitated by a tool that explains the specific spending categories in the GDP identity. This study presents a teaching strategy and tool to facilitate students' learning of the role of inventories in the GDP and how inventories can be used concurrently with other spending categories, that is, Consumption (C), Investment (I), Government Expenditure (G), and Net Exports (NX). It presents four scenarios in which inventories are used as a corrective mechanism to solve the temporal problem that the good produced in one year and sold in another create. By using this tool, the students can quickly and fully understand the role of inventories in GDP calculations.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
By making research freely available, we help support the greater global exchange of knowledge. There are no article submission or processing charges. Each journal volume is preserved via the Walker Library's three level preservation methods including local and cloud storage. The author(s) retains/retain the copyright to the work, but grants the Journal the right to publish, display, and distribute the work in print and electronic format. Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons CC BY-NC-ND 4.0 license that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal. For more information on this license go to https://creativecommons.org/licenses/by-nc-nd/4.0.