If consumption expenditures are $200 billion, total investment is $50 billion, government purchases are $40 billion, exports are $45 billion, imports are $40 billion, aggregate expenditures must be:
A) $275 billion.
B) $295 billion.
C) $320 billion.
D) $395 billion.

Question

Quizplus · Accepted Answer

Aggregate expenditures are the sum of consumption expenditures, investment, government purchases, exports, and imports. Thus, AE = $200 billion + $50 billion + $40 billion + $45 billion - $40 billion = $295 billion.

If Consumption Expenditures Are $200 Billion, Total Investment Is $50