National income and domestic product must be equal.

Question

Quizplus · Accepted Answer

National income and domestic product are often used interchangeably, and in theory, they should be equal. National income is the sum total of income earned by citizens and businesses of a country, while domestic product is the total value of goods and services produced within a country's borders. Therefore, national income should equal domestic product as every dollar earned by citizens and businesses is counted in the calculation of domestic product. However, in practice, there may be discrepancies due to issues like illegal economic activities or international trade.

National Income and Domestic Product Must Be Equal