If Output Determines Income and Income Determines Spending

question 7

Multiple Choice

If output determines income and income determines spending

• A) an equilibrium is impossible in the economy.
• B) intended spending and actual spending are always equal.
• C) the C + I line is the same as the 45-degree line.
• D) the levels of both national output and prices rise indefinitely.
• E) the level of GDP changes unless intended spending equals GDP.

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Definitions:

Stock Returns

The earnings generated from investing in shares of stock, including dividends received and capital gains from price increases.

Earnings Announcement Date

The date on which a company publicly releases its financial performance results for a specific period, often accompanied by a report and sometimes a conference call with analysts and investors.

Highest and Best Use

Highest and best use is a real estate principle that values a property based on its most profitable legal use.

Fair Value

The revenue generated from liquidating an asset or the cost involved in handing off a liability within a coordinated transaction among market members at the time of gauging its value.