Refer to the information provided in Figure 23.10 below to answer the question(s) that follow. Figure 23.10
-Refer to Figure 23.10. [200 + 0.8Y] represents the
A) MPC.
B) MPS.
C) aggregate expenditures function.
D) aggregate income function.

Question

Refer to the information provided in Figure 23.10 below to answer the question(s) that follow.  Figure 23.10
-Refer to Figure 23.10. [200 + 0.8Y] represents the
A) MPC. 
B) MPS. 
C) aggregate expenditures function. 
D) aggregate income function.

Quizplus · Accepted Answer

The expression [200 + 0.8Y] represents the aggregate expenditures function, which shows the total spending in the economy based on disposable income (Y). It includes both autonomous spending (represented by 200) and induced spending (represented by 0.8Y, which is the product of the marginal propensity to consume). Therefore, the correct choice is C.

Refer to the Information Provided in Figure 23