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In a Circular-Flow Diagram,total Income and Total Expenditures in an Economy

Question 1

Multiple Choice
In a circular-flow diagram,total income and total expenditures in an economy are:
A)equal because firms are ultimately owned by households.
B)equal only if there is no saving.
C)equal because every transaction has a buyer and a seller.
D)always equal because some people's income is not for production.

In a circular-flow diagram,total income and total expenditures in an economy are:


A) equal because firms are ultimately owned by households.
B) equal only if there is no saving.
C) equal because every transaction has a buyer and a seller.
D) always equal because some people's income is not for production.

Correct Answer:

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