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In economics, Aggregate Expenditure is a measure of national income. Aggregate Expenditure is defined as the current value of all the finished goods and services in the economy. The aggregate expenditure is thus the sum total of all the expenditures undertaken in the economy by the factors during a given time period. It refers to the expenditure incurred on consumer goods, planned investment and the expenditure made by the government in the economy. In an open economy scenario, the aggregate expenditure also includes the difference between the exports and the imports. Aggregate Expenditures is defined as : AE = C+Ip+G+Xn, here, * C = Household Consumption * Ip = Planned Investment * G = Government spending * Xn = Net exports (Exports-Imports) Aggregate Expenditure is one of the methods to calculate the sum total of all economic activities in an economy, which is referred to as the Gross Domestic product of an economy. The gross domestic product which is an important measure of the growth of the economy is calculated through the Aggregate expenditure model also known as the Keynesian cross.AE is also used in the Aggregate Demand-Aggregate Supply Model which advances the Aggregate Expenditures Model with the inclusion of Price changes. Components of Aggregate Expenditure (AE) - defined as the total amount that firms and households plan to spend on goods and services at each level of income. Also, it can be seen that the aggregate expenditure is the sum of expenditures on consumption, investment, government expenses and net exports. It is normally derived from all the components of the Aggregate Demand. Aggregate demand (AD) refers to the sum total of goods that are demanded in an economy over a period and thus AD is defined by the planned total expenditure in an economy for a given price level. ==Components of AE== Various schools of thoughts use various components to come up with the Aggregate Expenditure. The major school of economic thoughts which are the classical and Keynesian economists use the following components: *Consumption expenditure (C) Consumption refers to the household consumption over a given period of time. The total household consumption can be divided into two parts, they are: Autonomous Consumption and Induced consumption. Autonomous Consumption refers to the amount of consumption regardless of the amount of income, hence, even if the income is zero, the autonomous consumption would be the total consumption. Induced consumption refers to the level of consumption dependent on the level of income. * Y = Income *Investment (I) Investment is the amount of expenditure towards the capital goods. Investment refers to the expenditure towards goods that are expected to yield a return or increase their own value over time. The investment expenditure can be further divided into two parts, planned investment and unplanned investment. Over the long run the sum of differences in the unplanned investment would equal to zero as economy approaches equilibrium. *Government Expenditure:(G) The Keynesian model propagates an active state to control and regulate the economy. The government can make expenditure in terms of infrastructure or through transfers and thus increase the total expenditure in the economy as advocated by Keynes. *Net Exports:(NX) In an open economy, the total expenditure of the economy also includes the components of the net exports which is the total exports minus the total imports.〔(【引用サイトリンク】url=http://su-bc.org/PDF/tutorials/ECN112.pdf )〕 抄文引用元・出典: フリー百科事典『 ウィキペディア（Wikipedia）』 ■ウィキペディアで「aggregate expenditure」の詳細全文を読む スポンサード リンク
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