The AE curve illustrates the relationship between
A) real GDP and actual expenditure.
B) the interest rate and aggregate planned expenditure.
C) real GDP and the interest rate.
D) aggregate planned expenditure and real GDP.
E) the quantity of real GDP demanded and the price level.
D
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Factors that influenced planned investment spending include
A) real interest rates. B) financial frictions. C) emotional waves of optimism and pessimism. D) all of the above. E) A and C.
The negative slope of the demand curve reflects the:
a. positive relationship between price and quantity. b. proportional relationship between price and quantity. c. inverse relationship between price and quantity. d. positive relationship between income and quantity. e. inverse relationship between income and price.
Newly issued U.S. Treasury Securities are sold in:
A. only to the Federal Reserve who then resells them. B. secondary markets but only using registered bond dealers. C. the secondary market since bonds cannot be sold in the primary market. D. the primary financial market.
Refer to the above figure. In order to stay open in the short run, this firm must
A. earn a positive profit. B. recover its fixed cost. C. receive a price exactly equal to its average total cost. D. receive a price equal to or greater than the minimum of its average variable cost.