The figure given below shows the aggregate expenditure curve of an open economy.?Figure 10.1??In the figure:?C₁: Consumption?I1: Investment?G1: Government spending?X1: Net Exports
-Consider the economy described in Figure 10.1. Which of the following is true if the real GDP is equal to 0H?
A) Aggregate expenditures are greater than total income, when the real GDP is equal to OH.
B) All economic resources are being used efficiently, when the real GDP is equal to OH.
C) Households are dissaving an amount equal to DC, when the real GDP is equal to OH.
D) Businesses accumulate unwanted inventories, when the real GDP is equal to OH.
E) Unplanned investment decline, when the real GDP is equal to OH.
Correct Answer:
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