The Equality Between GDP and GDI in an Economy Implies

question 36

Multiple Choice

The equality between GDP and GDI in an economy implies that the income generated by final goods and services is equal to:

• A) expenditures on intermediate goods and services.
• B) gross private domestic investment.
• C) the total value of final goods and services produced.
• D) total wages and other employee compensation.

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Definitions:

Total Revenue

The total amount of money a firm receives from selling its goods or services, calculated as the unit price multiplied by the quantity sold.

Increasing-cost Industry

An industry in which the cost of production increases as the industry's output expands, often due to resource limitations or rising input prices.

Resource Prices

Resource prices are the costs associated with the inputs used in the production process, such as raw materials, labor, and capital.

Industry Expands

This phrase describes the process where the total output or the number of firms in a given industry increases due to factors such as innovation, increased demand, or favorable policies.