Why is it t that domestic product and national income must be equal?
A) The IRS national accounting system assures that taxes equal total income.
B) The total amount of spending must equal total national sales.
C) The value of final product must equal the sum of resource income that produced it.
D) The total amount of income earned is eventually spent.

Question

Quizplus · Accepted Answer

The value of final products is equal to the sum of resource income that produced it, as all factors of production (labor, capital, and land) receive income in the production process. Therefore, the value of all final products must be equal to the value of all income earned in the economy, meaning that GDP and national income must be equal to maintain this balance.

Why Is It T That Domestic Product and National Income