Question

If total spending rises from one year to the next, then Select one: a. either the economy must be producing a larger output of goods and services, or goods and services must be selling at higher prices, or both. b. employment or productivity must be rising. c. goods and services must be selling at higher prices. d. the economy must be producing a larger output of goods and services.

Answer 1

Answer:

a. either the economy must be producing a larger output of goods and services, or goods and services must be selling at higher prices, or both

Explanation:

Total Spending is the total values of goods & services produced & transacted ( bought, sold ) in an economy, during a period of time.

Total Spending = Price of goods,services x Quantity of goods,services

So, if the total spending increases : It implies that either the quantity of goods & services, or their prices, or both have increased. As, amount spent is a product of both of them.