Actual is less, if everybody would work overtime, actual would be more.
It is easier to use
It consists of two parts autonomous is determined by factors outside economy and induced is applicable only in the case of full employment (not true).
The equilibrium level is not always completely desirable (e.g. when full employment will occur above the eq. output).
Any investment or withdrawal will have multiple effect on economy.
That is only temporary, for the change to be permanent the investment must be permanent. Also exist investment and employment multiplier. If the investment is non-autonomous (rises with income) multiplier is bigger. Modifying factors:
In inflationary economy the savings are good things while in depression they are bad.
Deflationary and inflationary gaps occur when the equilibrium state is below or above full employment state. Gov. should intervene and it is not so expensive, because of the multiplier effect.
1. sector by sector breakdown
2. variations and linkages among components
3. the problem of measuring income
4. international comparisation
5. time and income ditribution problems