The dollar value of output for an economy must always equal the dollar value of income.
This must be true because each dollar of spending is ultimately assigned to one of the four factors of production.

Question

Quizplus · Accepted Answer

The dollar value of output represents the total value of goods and services produced within an economy, while the dollar value of income represents the total income generated from the production of those goods and services. Since the income is paid to the factors of production (land, labor, capital, and entrepreneurship) involved in the production process, the total income must be equal to the total value of output. Therefore, the statement is true.

The Dollar Value of Output for an Economy Must Always