Which of the following is assumed constant along the aggregate expenditure line?
A) the price level
B) consumption
C) unintended inventory adjustment
D) actual investment

Question

Which of the following is assumed constant along the aggregate expenditure line?  
A) the price level 
B) consumption 
C) unintended inventory adjustment 
D) actual investment

Quizplus · Accepted Answer

The price level is assumed to be constant along the aggregate expenditure line, as it is held constant in the short run to analyze the effect of changes in aggregate expenditures on real GDP. The other variables - consumption, unintended inventory adjustment, and actual investment - are all subject to change and thus not assumed to be constant.

Which of the Following Is Assumed Constant Along the Aggregate