The equation total production = total income = total expenditure is called
A)the goods-market equilibrium condition.
B)the total identity.
C)the fundamental identity of national income accounting.
D)Say's Law.

Question

Quizplus · Accepted Answer

The equation total production = total income = total expenditure is the fundamental identity of national income accounting, which is used to measure the economic activity within a country. It states that the three measures of economic activity (production, income, and expenditure) are equivalent and should add up to the same amount in any given time period. This identity is important for analyzing economic growth, measuring the effectiveness of government policies, and understanding the overall health of an economy.

The Equation Total Production = Total Income = Total Expenditure