If total spending rises from one year to the next, then
A)the economy must be producing a larger output of goods and services.
B)goods and services must be selling at higher prices.
C)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.
D)employment or productivity must be rising.

Question

Quizplus · Accepted Answer

Total spending can increase due to higher output (more goods and services produced) or due to higher prices (inflation), or a combination of both. This doesn't necessarily imply changes in employment or productivity directly.

If Total Spending Rises from One Year to the Next