Using the Keynesian aggregate expenditures model, which of the following is true?
A)Macro equilibrium may occur at levels of real GDP other than full-employment real GDP.
B)At any macro equilibrium, the actual rate of unemployment must equal the natural rate of unemployment.
C)If an economy is operating below full employment capacity, the Keynesian model indicates that lower wage rates will automatically adjust the economy back to full employment.
D)All of these are correct.

Question

Quizplus · Accepted Answer

In the Keynesian aggregate expenditures model, macro equilibrium can occur at levels of real GDP that are not at full employment, meaning the economy can be in equilibrium with unemployment or underutilized resources.

Using the Keynesian Aggregate Expenditures Model, Which of the Following