What Is the National Income Identity for an Open Economy

question 55

Short Answer

What is the national income identity for an open economy?

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Definitions:

Manufacturing

The process of converting raw materials or components into finished goods through the use of tools, human labor, and machinery.

Financial Accounting

The field of accounting that provides economic and financial information for investors, creditors, and other external users.

Raw Materials

Basic materials that are used in the production of goods, which have not yet been processed or manufactured.

Direct Materials

Raw materials that are directly incorporated into a finished product and are a significant portion of the product’s cost.