Question

Why must total spending be equal to total income in an economy? The two are equal because total income plus total spending equals total output. the value-added measurement of GDP shows this is true. every dollar that someone spends is a dollar of income for someone else. of all of the above.

          Why must total spending be equal to total income in an economy?
The two are equal because
total income plus total spending equals total output.
the value-added measurement of GDP shows this is true.
every dollar that someone spends is a dollar of income for someone else.
of all of the above.

Why must total spending be equal to total income in an economy?
The two are equal because
total income plus total spending equals total output.
the value-added measurement of GDP shows this is true.
every dollar that someone spends is a dollar of income for someone else.
of all of the above.

Added by Ronald P.

Principles of Economics

Gregory Mankiw 8th Edition

Instant Answer

Solved by Expert Akash M

09/20/2023

Step 1

Total income, on the other hand, refers to the total amount of money earned by individuals and businesses through various sources such as wages, salaries, profits, and rents. In an economy, total spending and total income are interconnected and must be equal for Show more…

Show all steps

Thanks for your feedback!

Why must total spending be equal to total income in an economy? The two are equal because total income plus total spending equals total output. the value-added measurement of GDP shows this is true. every dollar that someone spends is a dollar of income for someone else. of all of the above.