Why an economy’s income must equal its expenditure.

Question

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Answer 1

Question

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

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Answer 2

Question

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

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Answer 3

Question

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

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Answer 4

Question

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

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Answer 5

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

Answer 6

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

Answer 7

Chapter 23, Problem 1QR

To determine

Why an economy’s income must equal its expenditure.

Answer 8

Expert Solution & Answer

Explanation of Solution

The economy transacts the goods and services for getting the money in return. This means that the money acts as a medium between the buyers and sellers. When the buyers give money, it is the consumption expenditure of the consumers or the buyers. When the sellers receive money in return for the goods and services that they rendered to the consumers, it becomes their income. Thus, every transaction in the economy has a buyer and a seller, and every expenditure by the buyers turns out to be income of the seller. Therefore, it can be said that an economy’s income must equal its expenditures.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Concept introduction:

Expenditure: Total expenditure refers to the total amount of money spent by the firm, individual, or government on a product in a given period of time.

National income: National income refers to the sum of all the income received within a given period of time.

Answer 12

Ch. 23.1 - Prob. 1QQ Ch. 23.2 - Prob. 2QQ Ch. 23.3 - Prob. 3QQ Ch. 23.4 - Prob. 4QQ Ch. 23.5 - Prob. 5QQ Ch. 23 - Prob. 1QR Ch. 23 - Prob. 2QR Ch. 23 - Prob. 3QR Ch. 23 - Prob. 4QR Ch. 23 - Prob. 5QR

Why an economy’s income must equal its expenditure.

Why an economy’s income must equal its expenditure.

Explanation of Solution

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Chapter 23 Solutions