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2.2.1 The circular flow of income

Why do the output, income and expenditure approaches give the same national income total?

A

Every pound of output becomes income for a factor of production and is then spent.

B

Every pound of income becomes output for a factor of production and is then taxed.

C

Every pound of expenditure becomes output for a factor of production and is then exported.

D

Every pound of output becomes a withdrawal from a factor of production and is then saved.

2.2.1 The circular flow of income Flashcards

  1. A Level
  2. /Economics
  3. /2.2.1 The circular flow of income

Flashcards for AQA A Level Economics 2.2.1 The circular flow of income, covering the key terms, economic models and case studies you need to recall for Paper 1, Paper 2 and Paper 3. 19 cards, matched to the AQA A Level Economics (7136) specification.