Data on output and planned aggregate expenditure in Macroland are given below. $\begin{array}{cc}
& \text { Planned Aggregate }\
\text { Output }(\mathrm{Y}) & \text { Expenditure (PAE) }\
\hline 2,000 & 2,300 \
3,000 & 3,200 \
4,000 & 4,100 \
5,000 & 5,000 \
6,000 & 5,900
\end{array}$ Based on these data, the short-run equilibrium level of output is _____.
A) 2,000
B) 3,200
C) 4,100
D) 5,000

Question

Quizplus · Accepted Answer

The short-run equilibrium level of output, also known as the level of output where planned aggregate expenditure (PAE) equals actual output (Y), is where the two lines intersect on the graph. Looking at the data, we can see that the intersection occurs at an output level of 5,000. Therefore, the answer is D) 5,000.

Data on Output and Planned Aggregate Expenditure in Macroland Are