-Refer to Figure 11.1.Assume aggregate demand is represented by AD₁ and full employment output is $6.0 trillion.The equilibrium level of income is

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The equilibrium level of income is where aggregate demand equals aggregate supply (or output). In this case, it is where AD_{1 intersects with}. At this point, the equilibrium level of income is $5.8 trillion, which is less than full employment output of $6.0 trillion.