Answer to Question #109944 in Macroeconomics for Kg

Question

Which of the following statements are correct?
a. If spending equals to production and income, there is no tendency for production and income to change
b. If spending is greater than production and income, the level of production and income will decrease
c. If spending is greater than production and income, the level of production and income will increase
d.If spending is less than production and income , the level of production and income will decrease
e. Spending may be equal to income, but smaller than production

1. b and e
2. a, c and e
3. a, b,c and e
4. a and d

Answer 1

True statements are a, c and e, so the answer is 2.