The figure illustrates the various types of expenditures that flow from households to businesses.





Any household consumption spending is considered an expenditure (such as buying groceries, paying a mortgage, purchasing school supplies, visiting the optometrist).
Any household savings or money spent on Canadian investments are included as investments (such as a contribution to the Terry Fox Run, a deposit of money in a savings account, the purchase of a Guaranteed Investment Certificate from a bank).
All government spending falls under the label of Government Purchases label. Governments collect local, provincial, and federal tax money and use it to buy goods and services for both households and businesses (such as education, medical care, schools, hospitals, and roads).