The national income accounting system measures economic activity based on the concept of _____

Question

Quizplus · Accepted Answer

The national income accounting system measures economic activity by tracking the circular flow of output and income through the different sectors of an economy. This includes measuring GDP, national income, and various other metrics that measure the flow of goods, services, and income throughout the economy. The concept of comparative or absolute advantage is not directly relevant to measuring economic activity through national income accounting. The circular flow of precious metals and money is also not a concept used in national income accounting, although money is certainly a part of the economy being measured. Finally, while labor and other resources are important parts of economic activity, they are not the primary focus of national income accounting.

The National Income Accounting System Measures Economic Activity Based on the Concept