If total spending rises from one year to the next,then

Question

Quizplus · Accepted Answer

When total spending rises, it could be due to various reasons such as an increase in consumer demand, government spending, investment, or exports. As a result, either the economy must be producing a larger output of goods and services to meet the increased demand or the prices at which goods and services are sold must be higher due to increased demand or costs of production. It is possible that both production and prices may increase simultaneously. Therefore, option C is the best answer. Option A and D may or may not occur, as an increase in spending does not necessarily indicate an increase in employment or productivity. Option B is also a possible explanation but not the only possible explanation, and option C covers all possible scenarios.

If Total Spending Rises from One Year to the Next,then