The equilibrium level of income will rise when:

Name: The equilibrium level of income will rise when:
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Question

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When aggregate expenditures (AE) exceed real GDP, it means that there is excess demand in the economy, which will lead to an increase in production and output, resulting in an increase in the equilibrium level of income. This is because firms will increase their output to meet the demand, and this will lead to increased production, employment, and income.

The Equilibrium Level of Income Will Rise When