Expenditures that vary with the level of real GDP are called
A) aggregate expenditures.
B) induced aggregate expenditures.
C) marginal expenditures.
D) autonomous aggregate expenditures.

Question

Quizplus · Accepted Answer

Expenditures that vary with the level of real GDP are called induced aggregate expenditures. These expenditures are influenced by changes in income and are typically consumer and investment spending. Autonomous aggregate expenditures, on the other hand, are not influenced by changes in income and include government spending and exports. Aggregate expenditures refer to the total expenditures in an economy, while marginal expenditures refer to the additional cost of producing one more unit of output.

Expenditures That Vary with the Level of Real GDP Are