The amount by which an aggregate expenditures schedule must shift upward to achieve the full-employment GDP is a(n):
A) Inflationary expenditure gap
B) Recessionary expenditure gap
C) Expenditure multiplier gap
D) Negative net export gap

Question

Quizplus · Accepted Answer

A recessionary expenditure gap refers to the difference between the actual level of GDP and the full-employment level of GDP. Therefore, the amount by which aggregate expenditures must shift upward to reach the full-employment GDP is the recessionary expenditure gap. The other options are not relevant to this scenario.

The Amount by Which an Aggregate Expenditures Schedule Must Shift