Refer to Table 23-2. Using the table above, compute aggregate expenditure and identify the macroeconomic equilibrium
What will be an ideal response?
The macroeconomic equilibrium is determined where aggregate expenditure = real GDP. The value for aggregate expenditure (C + I + G + NX) for each level of real GDP is given in the table below. The value where real GDP equals aggregate expenditure is $3,000, and this is equilibrium.
Real GDP Aggregate Expenditures
$2,000 $2,200
2,500 2,600
3,000 3,000
3,500 3,400
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A) 50 B) 112 C) 103 D) 123
Suppose a decrease in the supply of wheat results in an increase in revenue. This indicates that
A) the demand curve for wheat must be vertical. B) the resulting increase in price is proportionately greater than decrease in quantity sold. C) the decrease in quantity sold is proportionately larger than the resulting change in price. D) the supply curve for wheat must be vertical.