Draw a simple macroeconomic circular flow diagram that shows households and firms (but ignores the rest of the world and the government). Label and name the flow of income and the flow of goods/resources from households to firms.

With reference to your diagram in a., explain why the income and expenditure methods of calculating Gross Domestic Product (GDP) result in the same value.

In what way can GDP be used to compare the well-being of people across countries? Provide two reasons why using GDP this way is imperfect and explain what aspects of well-being are being overlooked or ignored.

Why is Australia's GDP typically higher in the December and March quarters than in the September and June quarters? Why does the Australian Bureau of Statistics (ABS) publish seasonally adjusted GDP figures? Is it more important to use seasonally adjusted data when calculating quarterly or annual growth?