Video narration
Why can one economy seem to have three different totals? Think about a household budget: money comes in as income and goes out as spending. An economy produces goods and services. National income accounts track this activity over a period. GDP is the market value of final goods and services produced in a country during that period. The same activity appears as production, income, or spending on final output. These are not competing totals. They are three ways of recording one flow. When you spend, someone else receives income. Count final output only once. A component sold to a manufacturer is intermediate; counting it again in the finished product overstates the economy. In principle, production equals income equals expenditure, though measurement error can make estimates differ slightly. So, why three totals? They are three views of the same activity: what is produced becomes someone's income and someone else's spending.