In a closed economy,the total income of everyone in the economy is exactly equal to the total:
A) expenditure on the economy's output of goods and services.
B) consumption expenditures of everyone in the economy.
C) expenditures of all businesses in the economy.
D) government expenditures.

Question

Quizplus · Accepted Answer

In a closed economy, total income of everyone in the economy is the sum of all wages, salaries, rents, interest, and profits earned. This also corresponds to the value of the goods and services produced in the economy. Hence, the total income of everyone in the economy is exactly equal to the total expenditure on the economy's output of goods and services.

In a Closed Economy,the Total Income of Everyone in the Economy