Using the Aggregate Expenditures Model, Which of the Following Occurs

question 1

Multiple Choice

Using the aggregate expenditures model, which of the following occurs if aggregate expenditures fall short of real GDP?
I. Actual investment exceeds planned investment.
II. Unemployment rises.
III. The price level will fall.
IV. The economy will experience a recessionary gap.

• A) I and II
• B) I and III
• C) I, II, and III
• D) I, II, III, and IV

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Definitions:

Cerebellum

A part of the brain that regulates motor movements, coordination, balance, and posture.

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The circadian rhythm that regulates periods of sleepiness and wakefulness over a 24-hour period.

Coordination

The ability to use different parts of the body smoothly and efficiently together or to organize activities harmoniously.

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The process of acquiring new understanding, knowledge, behaviors, skills, values, or preferences.