Aggregate planned expenditure decreases if
A)real GDP decreases.
B)government expenditure on goods and services increases.
C)autonomous consumption increases.
D)exports increase.
E)investment increases.

Question

Quizplus · Accepted Answer

If real GDP decreases, then aggregate planned expenditure will also decrease. This is because people will have less income to spend on goods and services, and firms will produce fewer goods and services because there is lower demand. The other options would all lead to an increase in aggregate planned expenditure.

Aggregate Planned Expenditure Decreases If