Which of the following variables is fixed in the aggregate expenditure model?
A) price level
B) consumption
C) output
D) investment
E) real GDP

Question

Quizplus · Accepted Answer

In the aggregate expenditure model, the price level is fixed in the short run. This means that any changes in total spending (aggregate expenditure) will result in changes in real GDP but not in the price level. The other variables, including consumption, output, investment, and real GDP, are all potentially variable and can change based on different factors.

Which of the Following Variables Is Fixed in the Aggregate