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Economics vocabulary · GDP and Growth

Consumption

Meaning in economics, with examples

/kənˈsʌmpʃn/nounCore term

In economics, consumption means: The spending of households on goods and services such as food, clothes, rent and transport; it is usually the largest part of a country's GDP.

In Turkish: tüketim, özel tüketim

How it is used

In national accounts it is called private consumption or household final consumption expenditure. News reports say consumption rose, slowed or was the main driver of growth. In energy consumption, the word means the amount used, not spending.

Example sentences

  1. Private consumption was the main driver of growth in the second quarter.

  2. Consumption slowed as higher interest rates made borrowing more expensive.

Common collocations

  • private consumption
  • household consumption
  • public consumption
  • consumption-led growth
  • consumer spendingThe money that households spend on goods and services, from food and rent to cars and holidays; it is the largest part of GDP in most economies.
  • investmentSpending on things that will be used to produce more in the future, such as machines, buildings and software; in GDP data it does not include buying shares.
  • GDPShort for gross domestic product: the total value of all final goods and services produced within a country in a given period, usually a quarter or a year.
  • householdAll the people who live together in one home and share its income and spending; in economic models, households buy goods and services and supply labour.
  • aggregate demandThe total spending on goods and services in an economy at a given price level: consumption, investment, government spending and net exports added together.

More terms: GDP and Growth

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This page explains English vocabulary for learners. It is not financial advice.