Identify the Correct Statement

question 78

Multiple Choice

Identify the correct statement.

• A) National income accounting measures only the flow of output between different sectors of an economy.
• B) National income accounting summarizes the level of production in an economy over a decade.
• C) National income accounting explains diagrammatically the flow of goods and services and of money expenditures (income).
• D) National income accounting summarizes and categorizes the productive activity in an economy over a year.
• E) National income accounting measures the total money supply in an economy.

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Definitions:

Money Supply

The sum of all available money in an economy at a given moment, encompassing cash, coins, and bank account balances.

Real GDP

The measure of the value of economic output adjusted for price changes (inflation or deflation), reflecting the real volume of production.

Price Level

The overall price mean for each and every product and service in the economic sector.

Aggregate Supply Curve

A graphical representation showing the relationship between the overall price level in an economy and the total output produced by firms at that price level.