The household, firms and government spending in Australia have changed over time and this change has affected the economy and gross domestic product (GDP) growth of the country in significant way. The distribution of spending and saving is important, as among the other, it can affect the way that the consumer sector respond to economic shocks. Real per capita consumption and disposable income in Australia both have risen by 2% on yearly basis form 2009 till yet. The current aggregate trends in Australia can mask the important changes in distribution of income and spending across the household, firms and governments (Australian bureau of statistics, 2016). The household income as per the Australian bureau of statistics data is given below. As per the Australian national accounts, there is crisis in Australia and hence the gross domestic product and economy is in trouble. It is observed that by 2011, the GDP growth of the Australian country dropped by 2.4% and the real GDP decreased by 1.2% in between 2009 to 2015. In Australian economy, the major positive contributions to expenditure on GDP were private gross fixed capital formation with some necessary contribution from private consumption.
The average expenditure is 18% on goods and services by Australian population and the government spending increased by 40% over the last few years. The spending pattern is uneven but still the spending has been grown over the few years. The aggregate expenditure and its relation to the Australian GDP is discussed below. GDP growth is directly related to the economy of the country and expenditure factors (Australian bureau of statistics, 2016).Aggregate expenditure is the current value of all the finished goods and services in the country considered to the country’s economy by the factors during a specific time period. Aggregate expenditure is one of the method to measure the total sum of all economic activities in an economy which is known as the gross domestic product (GDP) and this is important because it measures the growth of the economy. Gross domestic product (GDP) of any country is calculated with aggregate expenditure model. Aggregator expenditure has direct impact on the economy of any country as well its significant contribution to the growth of the country as growth in gross domestic product (Boundless, 2015).