Because Every Transaction Has a Buyer and a Seller

question 226

Multiple Choice

Because every transaction has a buyer and a seller,

• A)GDP is more closely associated with an economy's income than it is with an economy's expenditure.
• B)every transaction contributes equally to an economy's income and to its expenditure.
• C)the number of firms must be equal to the number of households in a simple circular-flow diagram.
• D)firms' profits are necessarily zero in a simple circular-flow diagram.

---

Definitions:

Initial Investment

The amount of money used to start an investment, often the starting capital for a business or financial venture.

Gain on Sale

The financial profit realized when an asset is sold for more than its original purchase price or book value.

Jointly Controlled Operation

A business activity where two or more parties share control and decision-making responsibilities.