Aggregate demand in the economy is equal to
A) Consumption, investment and government spending.
B) Consumption, investment and net exports.
C) Full employment output.
D) None of the above.
Answer: D
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When the production of a good creates an external cost, by setting the tax rate equal to the ________, firms can be made to behave in the same way as they would if they bore the cost of the externality directly
A) marginal external cost B) marginal social benefit C) marginal private benefit D) marginal social cost
From 1929 to 2013, the unemployment rate in the U.S. ________
A) has continued to grow but has always remained well above zero B) has fluctuated around zero C) has gone up and down but has always remained well above zero D) has decreased in most recessions E) has grown by a factor of four