For an economy as a whole,

Question

Quizplus · Accepted Answer

According to the basic principle of national income accounting, income must equal expenditure in an economy as a whole. This means that the total value of goods and services produced (GDP) must be equal to the total amount spent on them by households, businesses, and the government. Therefore, the correct answer is C, income is equal to expenditure. Option A and B are incorrect as they suggest inequality between income and expenditure. Option D is incorrect as GDP measures both income and expenditure equally.

For an Economy as a Whole