In a Simple Circular-Flow Diagram, Total Income and Total Expenditure

question 221

Multiple Choice

In a simple circular-flow diagram, total income and total expenditure are

• A)never equal because total income always exceeds total expenditure.
• B)seldom equal because of the ongoing changes in an economy's unemployment rate.
• C)equal only when the government purchases no goods or services.
• D)always equal because every transaction has a buyer and a seller.

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Definitions:

Merit Pay

Additional compensation provided to employees based on their job performance, highlighting the value of high performance and excellence.

Performance Appraisals

Formal assessments and reviews of an employee's work performance over a specific period, used to determine areas of improvement and inform decisions on promotions, bonuses, and training needs.

Organizations' Profits

The financial gain that an organization achieves after deducting the expenses, costs, and taxes necessary to sustain its operations.

Stock Price

The cost of purchasing a share of a company, which fluctuates based on market conditions, company performance, and investor perceptions.