Refer to the diagram for a private closed economy. At the $200 level of GDP:
A. consumption is $200 and planned investment is $50 so that aggregate expenditures are
$250.
B. consumption is $200 and planned investment is $100 so that aggregate expenditures are
$300.
C. consumption is $250 and actual investment is $50 so that aggregate expenditures are
$300.
D. aggregate expenditures fall short of GDP with the result that GDP will decline.
A. consumption is $200 and planned investment is $50 so that aggregate expenditures are
$250.
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IBM's marginal rate of return on investment curve equals its
a. supply of loanable funds curve b. supply of investment curve c. marginal revenue product curve d. marginal revenue cost curve e. investment demand curve
Which of the following statements concerning the effects of demographics on consumption is not true?
a. The size of the population affects the slope of the consumption function. b. The age of the population affects the slope of the consumption function. c. Other things equal, the level of consumption will rise with increases in population. d. Younger households tend to have higher MPCs than older households. e. Older households tend to have higher MPSs than younger households.