In the basic Keynesian-cross model,actual expenditures equal:
A) GDP.
B) the money supply.
C) the supply of real balances.
D) unplanned inventory investment.

Question

Quizplus · Accepted Answer

In the basic Keynesian-cross model, actual expenditures equal GDP because GDP measures the total output produced and sold in an economy, which includes consumption, investment, government spending, and net exports. Actual expenditures equal the sum of these components, and therefore, equal GDP.

In the Basic Keynesian-Cross Model,actual Expenditures Equal