Refer to the above diagram for a private closed economy.At the $300 level of GDP:
A)aggregate expenditures and GDP are equal.
B)consumption is $250 and planned investment is $50.
C)saving equals investment.
D)all of the above are true.

Question

Refer to the above diagram for a private closed economy.At the $300 level of GDP:
A)aggregate expenditures and GDP are equal. 
B)consumption is $250 and planned investment is $50. 
C)saving equals investment. 
D)all of the above are true.

Quizplus · Accepted Answer

At the $300 level of GDP, aggregate expenditures and GDP are equal because there is no government or international sector influencing the economy. Consumption is $250 and planned investment is $50, which together add up to the total output of $300. This implies that saving equals investment, as there are no leakages or injections in the economy. Therefore, all of the above statements are true for a private closed economy at the $300 level of GDP.

Refer to the Above Diagram for a Private Closed Economy