The equilibrium level of GDP in the economy in the above diagram:
A)is $100.
B)is $200.
C)is $240.
D)is $320.

Name: The equilibrium level of GDP in the economy in the above diagram: A)is $100. B)is $200. C)is $240. D)is $320.
Brand: Quizplus
Rating: 4.8 (31 reviews)

Question

The equilibrium level of GDP in the economy in the above diagram:
A)is $100. 
B)is $200. 
C)is $240. 
D)is $320.

Quizplus · Accepted Answer

The equilibrium level of GDP occurs where the aggregate expenditures (AE) line intersects the 45-degree line. In this case, the AE line intersects the 45-degree line at a GDP level of $240. Therefore, the equilibrium level of GDP is $240.

The Equilibrium Level of GDP in the Economy in the Above