Which statement is false?
A) Consumer spending is business income.
B) Business spending is consumer income.
C) If consumers and businesses both cut spending, everyone's incomes falls.
D) If consumers and businesses both cut spending, employment increases.
E) Falling wages decrease demand in output markets.

Question

Quizplus · Accepted Answer

If both consumers and businesses cut spending, it usually leads to a decrease in demand for goods and services, which can cause businesses to cut back on production and lay off workers. This means that employment would decrease rather than increase.

Which Statement Is False