At macroeconomic equilibrium, total ________ equals total ________.
A)spending; production
B)investment; inventories
C)consumption; production
D)taxes; transfers
E)spending; savings

Question

Quizplus · Accepted Answer

At macroeconomic equilibrium, total spending equals total production since all goods and services produced must be purchased by someone. Consumption, investment, and government spending all contribute to total spending, while production is the total value of all goods and services produced in the economy. Invested funds may also help with production, but in this scenario, investment doesn't equal total production. Taxes and transfers affect spending and income distribution, but they are not equal to total production. Similarly, spending and savings are both important components of total spending, but savings alone do not equal production.

At Macroeconomic Equilibrium, Total ________ Equals Total ________

At Macroeconomic Equilibrium, Total Equals Total